DEFIANT Sir Keir Starmer today declared Britain is braced “for all eventualities” hour before of Donald Trump launches his global trade war.
At PMQs Sir Keir made a last-ditch plea for the US President to abandon his onslaught of tariffs, warning “a trade war is in nobody’s interests”.
Sir Keir Starmer was last night braced for the UK to take an instant hit in Donald Trump’s global trade war[/caption]
President Trump is expected to put 20 per cent tariffs on goods[/caption]
He said: “We have been preparing for all eventualities ahead of the confirmation of US tariffs later today.
“Let me be clear with the House. A trade war is in nobody’s interests and the country deserves, and we will take, a calm, pragmatic approach.”
Sir Keir added: “That is why constructive talks are progressing to agree a wider economic prosperity deal with the US.
“That is why we are working with all industries and sectors likely to be impacted.
“Our decisions will always be guided by our national interest and that is why we have prepared for all eventualities and we will rule nothing out.”
No10 was today preparing for the worst, with 20 per cent tariffs
expected to be slapped on all imported goods after efforts to charm the President failed.
The White House said the charges would come into effect immediately once they were announced today.
Britain will then engage in more frantic diplomacy to get some or all
of the tariffs lifted, amid fears they will batter economic growth and
wipe out the Government’s £10billion financial cushion.
Trump was last night fine-tuning his announcement for what his Press Secretary Karoline Leavitt said would be one of the “most important days in modern American history“.
She said: “We are focused on restoring the golden age of America,
and making America a manufacturing superpower.”
Foreign Secretary David Lammy told MPs Britain was “preparing for
the worst”.
He said all options remained on the table but No10 was not expected to retaliate immediately by imposing tariffs on the US.
What to expect on Trump's 'liberation day'
THE US president is expected to unveil sweeping tariffs at an event at the White House around 9pm UK time, in a move he has dubbed “liberation day”.
It is unclear what Mr Trump will announce on Wednesday, but his administration views the application of VAT rate as discriminating against US goods and could respond with a 20 per cent tariff on imports from the UK.
Mr Trump has already announced a 25 per cent import tax will be introduced on all cars imported to the US, a measure which will be a blow to the UK’s automotive industry.
Some 16.9 per cent of UK car exports were to the US last year, representing a total of more than 101,000 units worth £7.6billion.
Tariffs on steel and aluminium imports, including from British firms, are already in place.
PM Sir Keir said he would not resort to knee-jerk tactics but make a “calm and collected response”.
Deputy PM Angela Rayner said it would be ridiculous to cancel Trump’s unprecedented second state visit in response to the tariffs.
She said: “I don’t think that’s where we’re at at all. It’s not about who visits the King or not. It’s about putting the British interest first.”
Tory leader Kemi Badenoch said a trade deal was the best way to avoid tariffs and urged “significant diplomacy”.
She said: “Some people will want us to have trade retaliation. That just makes everyone poorer.”
Experts say that Chancellor Rachel Reeves‘ headroom revealed at last
week’s Spring Statement could be obliterated if tariffs were kept in place for the rest of the decade.
Analysis from the Institute for Public Policy Research (IPPR) suggested tariffs on car imports would put 25,000 UK jobs at risk and “completely destabilise the UK car manufacturing industry”.
Trump is expected to put 20 per cent tariffs on goods but 25 per cent levies on all car imports.
He was said to be open to discussing the pending levies with
world leaders, officials said.
But a White House spokeswoman said: “There is one country that the president cares most about and it is the US.”
Although a deal is unlikely to be reached before Mr Trump’s announcement, UK negotiators are reported to be pursuing an agreement with the US focused on technology.
Such a deal is said to include possible changes to the digital services tax – which imposes a 2 per cent levy on the revenues of several major US tech companies – in exchange for a carve-out from the tariffs.
Ministers have refused to deny that changes to the digital services tax are being considered.
On Tuesday evening, Treasury minister James Murray said that he would not give a “running commentary” on negotiations.
But he added the “principle” of any decision would be “businesses paying their fair share”.
WHAT will the immediate impact be for the UK?
At the very least, there will be huge uncertainty and companies are already having to pause their investments or shipments to the US while they wait for the full impact of Trump’s onslaught.
Trump has already indicated there will be 25 per cent tariffs on all imports of steel and cars, which would hit British manufacturers such as Aston Martin and Jaguar Land Rover.
There is also nervousness that Trump could look to punish the UK because of our policy of imposing VAT on the sale of most goods.
Trump hates VAT and has called it “unfair and discriminatory”.
A blanket tariff on UK exports would clobber everything from cheese to luxury clothing and whisky.
Pharmaceuticals and chemicals firms are particularly exposed.
WHAT does it mean for consumers?
One word: Pain.
Tariffs are a nightmare for business because they make the flow of goods around the world much more expensive.
As we found out from the hangover of the pandemic, any snarl in supply chains leads to prices soaring.
If the UK snaps back and imposes tariffs on US goods, it would make products such as Levi’s jeans, Jack Daniel’s and Harley-Davidsons much more expensive for British consumers.
There is the counter argument that goods could become cheaper as companies divert products originally destined for the US to the UK.
But, in the long-term, the big risk is that this so-called “diversionary trade” ends up flooding our market with cheap imports, ruining British homegrown companies who can not compete and costing thousands of jobs.
