Speaking to The News Agents podcast, Lammy said: “It’s self-evident that leaving the European Union badly damaged our economy, took us out of an important marketplace and created serious friction.
Asked whether he wanted to see the UK in a customs union with the EU, he replied: “That’s not currently our policy, that’s not currently where we are.”
However, he highlighted that Turkey, which is in a customs union with the bloc, was “seemingly benefiting and seeing growth in their economy”.
Turkey’s deal, which does not apply to agricultural goods, or services, reduces the the need to prove the origin of many goods it trades with the EU – a considerable source of trade friction for the UK since Brexit.
The model has previously been suggested as a more realistic option for bolstering ties than rejoining the EU’s customs union itself.
However, the arrangement does significantly curtail Turkey’s ability to pursue an independent trade policy – a key promise made by Brexiters.