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We will fight Trump's plan to impose tariffs on the UK Rachel Reeves | Rachel Reeves

We will fight Trump's plan to impose tariffs on the UK Rachel Reeves | Rachel Reeves

 


Prime Minister Rachel Reeves said in a keynote speech this week that promoting free and open trade between countries as a cornerstone of British economic policy would put a Labor government in direct conflict with President-elect Donald Trump.

Reeves will make his first speech at Mansion House, the Prime Minister's annual exhibition to outline his post-Budget plans for growth. But as the British government struggles to respond to Trump's resounding victory and the challenges it poses for Britain on key issues of economic and foreign policy, the prime minister is expected to make clear he will fight against Washington to defend free trade. .

The issue is fast emerging as a major test of the relationship between President-elect Trump and London, as well as their differing approaches to continued support for Ukraine's war with Russia. Trump, who on Friday pledged to impose high tariffs on all imports entering the United States, wasted no time in calling on protectionist Robert Lighthizer to return as U.S. trade representative when he takes office again in the White House in January.

Just before last week's presidential election, Lighthizer blamed free trade for the loss of domestic manufacturing and linked it to criticism of America's massive trade deficit. Such an appointment would cause further anxiety in the British government and increase fears that President Trump will continue his threats to impose tariffs that could cause significant damage to the British economy.

The appointment of Robert Lighthizer as Trump's trade representative will cause deep anxiety in London. Photo: Sarah Silbiger/Reuters

On Wednesday, Goldman Sachs cut its forecast for UK economic growth in 2025 from 1.6% to 1.4%, citing the possibility of higher US tariffs. The National Institute of Economic and Social Research said the trade war over tariffs would cut Britain's already sluggish growth rate by 0.7% and 0.5% in the first two years of President Trump's second term.

Writing in the Observer today, former British Ambassador to the US Kim Darruck said he expected Trump to follow through on his tariff threats. Describing the impact on the UK's relationship with the EU as well as the US, Darroch said: When it comes to tariffs, I expect the result will be the exact opposite of a simple threat.

I think President Trump will immediately impose tariffs on all American imports and tell me to propose measures to rebalance trade if he wants to eliminate the tariffs. The EU will almost certainly retaliate. Britain will face difficult decisions. Will EU retaliatory tariffs be aligned? Or do you pursue bilateral deals, such as free trade agreements?

I think Trump will propose an FTA like he did in 2017. But as then, top demand in the U.S. includes low-cost products from the U.S. agricultural sector, such as hormone-treated beef and chlorine-washed chicken. So the stark choice will be whether to side with the EU or to sacrifice agriculture.

On Ukraine, Darroch said that if Trump supports a peace deal that looks like a defeat for Volodymyr Zelenskyy, keeps Russian-occupied territories and promises Ukraine will never join NATO, Britain will again have to choose between the EU and the European Union. Point out that you will do it. Washington.

Another difficult decision for the Prime Minister: Should he rally Europe to reject the American idea and increase support for Ukraine, or should he pack his tent, accept defeat and return home?

Trump's dramatic victory has sparked a heated debate in Westminster over how best Keir Starmus' administration can respond to the unpredictable figure in the White House.

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Peter Ricketts, a former British ambassador to Paris and Britain's first national security adviser, said Starmer should avoid appearing too needy or too keen on upsetting him. I would say that I value contact with Trump rather than trying to get through the White House door first. This was rather the tendency of some of his predecessors. The risk is that you embarrass yourself when he does something you completely disagree with.

Also writing today, Peter Hyman, an observer who has advised Tony Blair and Keir Starmer, said Americans should learn a lesson about why they voted for Trump because Labor could become a victim.

A similar phenomenon occurred in the UK. He wrote that too many people viewed Trump supporters as part of a deluded public too foolish to see him as a monster, and in fact many had good reasons to vote for him.

The truth is that the Democratic Party has lost the heads and hearts of the people. They failed to be good technocrats (chiefs) due to high inflation and open borders. And it failed to tell a story that workers' families who were struggling could see, hear, and feel.

This is now a difficult task for the Democrats in the US as they fight to regain power, and the Labor Party in the UK as they seek to pull off their victory.

Trump's victory, like Thatcher's victory in 1979, could be a moment when the old rules of politics are completely changed and the building blocks of a new progressive project must be rebuilt, brick by brick, from first principles.

Sources

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2/ https://www.theguardian.com/politics/2024/nov/09/we-will-fight-trumps-plans-to-slap-tariffs-on-the-uk-rachel-reeves

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