Business Secretary Jonathan Reynolds said Donald Trump’s bombshell announcement of a 10% US tariff on all British imports are a ‘disappointment’ and ‘a challenge’
The Business Secretary has admitted the US won’t “get their own way” on everything they are asking for in a deal with the UK.
Jonathan Reynolds said Donald Trump’s bombshell announcement of a 10% US tariff on all British imports is a “disappointment” and “a challenge”. He said the UK “can’t rule anything out” in terms of its response to US tariffs, but that businesses are telling him not to “overreact” and to “remain at the table”.
Mr Reynolds and officials have been locked in talks with the US to try to secure an exemption from tariffs for the UK. But they were unable to get an economic deal over the line before US President last night unleashed tariffs across the world on his so-called ‘Liberation Day’.
Discussions for an economic deal are ongoing and ministers are hopeful that the UK’s 10% tariff – lower than most countries around the world – is a sign that negotiations have already made an impact. There has been speculation that the UK could ease the Digital Services Tax for tech billionaires as part of the deal but Mr Reynolds made clear the UK will not be able to meet all of the demands from Mr Trump’s administration.
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Asked if the world is heading for a global recession, Mr Reynolds told Sky News: “I wouldn’t want to speculate on the outcome. This is very clearly a significant set of announcements from the US. I would say, when I look at the work that we’ve been able to do with the US so far – of course, I’m negotiating in the UK’s national interest there – I hope perhaps if we are successful there would be a template there for other countries to resolve some of these issues.
“There’s a set of complaints from the US about how some of the current global trading arrangements work. They won’t get their own way on all of that. But there are some things to talk about: if the US is the world’s number one customer, they do want to be treated like that.”
The government has similarly not ruled out retaliatory tariffs – which the EU is expected to put on the US – with Mr Reynolds adding: “We in the UK will take any action we need to give ourselves the tools that we need to respond to announcements of this kind. There’s some formal steps we need to take, particularly the evidence you ask for from business that comes into the Department for Business and Trade, and we can base decisions upon that.
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“Whilst we have a chance of making the relationship between the UK and the US even stronger than it is, the message I get very strongly from businesses (is) ‘remain at the table, don’t overreact’. Stick with the calm-headed approach the UK Government has had to date, and we’re going to do that, but we can’t rule anything out because, again, we’ve got to make decisions for no-one else other than the United Kingdom.”
Mr Reynolds also told Times Radio: “Any barrier to trade, particularly between the UK and our major trading partner, which the US is, is a disappointment to me. It’s a challenge. So, I recognise that the UK is in a better position than a lot of other countries from what was announced last night, but I was still disappointed.” He said the UK has “modelled every scenario” for the impact of tariffs but it is “not just about the relationship between the UK and the US, but what is going on in the rest of the world”.
In a rambling press conference on Wednesday night, Mr Trump slapped 10% tariffs on imports of British goods as he declared war on “foreign cheaters” with trade levies on countries around the world. The US President ranted against nations who he claimed had “ripped off” US taxpayers, saying: “Our country has been looted, pillaged, raped, plundered”. In a move that will risks sparking a global trade war, Mr Trump signed an executive order imposing “reciprocal” tariffs on dozens of countries.
These included 20% on the EU, 34% on China, 26% on India and 49% on Cambodia. Britain escaped the worst of his wrath, receiving the baseline level tariff of 10%, which comes into force at 5am on Saturday. A 25% tariff will also be imposed on all foreign cars imported to the US from 5am today – which experts fear could cost 25,000 jobs in the British car industry.
In a speech in the White House Rose Garden, Mr Trump described the bombshell move as a “declaration of economic independence” which he said would “make America wealthy again”. “Taxpayers have been ripped off for more than 50 years,” he said. “But it is not going to happen anymore.”
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