PM insists UK approach to tariffs is correct as other nations offered reprieve

The UK’s decision not to retaliate to US President Donald Trump’s tariffs was not the wrong one, Prime Minister Sir Keir Starmer has insisted, as a pause on the trade tax now means other nations face the same low rate as Britain.

Most countries now face a 10% rate on importing goods to America after the US president paused the sweeping retaliatory tariffs which had sent global markets into turmoil.

The 10% rate was the lowest rate Mr Trump announced last week on “liberation day”, as he set out plans apparently aimed at rebalancing American trade with other nations.

Relationship

But his snap decision to halt all reciprocal levies in favour of the single rate means that even trade partners such as the EU, which had voted to retaliate against America, now face the same costs as the UK.

The Prime Minister denied the British approach to not retaliate to the US tariffs had resulted in no advantage for the UK.

He told reporters during a visit to Cambridgeshire: “I don’t think having a strong relationship with the US has given us no advantage whatsoever.

“We have got a very strong relationship on defence, security, intelligence sharing.

“No two countries are as closely aligned as ours.”

When pressed that most nations now face the same tariff rate as the UK, Sir Keir said: “Of course we are continuing to talk to the US about how further we can mitigate the impact of the tariffs.

“But a trade war is in nobody’s interest and there is no business sector that is being impacted by these tariffs who is saying jump in with both feet to retaliate and cause a trade war.”

‘Calm’

Before he paused the tariffs, Mr Trump joked at a Republican Party event in Washington DC that countries were “kissing my ass” to hold trade deal talks.

Asked if he was comfortable with this language, Sir Keir insisted America was Britain’s “closest ally” and it was important to maintain a “calm and pragmatic approach” to negotiations.

The president’s surprise announcement of the 90-day pause to hefty tariffs imposed on some countries brought respite to battered stock markets across the globe, including London’s FTSE 100.

Sir Keir reiterated his message that the tariffs signalled a shifting world to which the UK must adapt, without directly criticising the US president.

Speaking during a morning visit to Doncaster on Thursday, the Prime Minister said: “We’ve got to rise to the moment here, recognise where our future lies, renew Britain and deliver security for working people.”

Ministers still hope an economic deal with America can be reached to soften the blow of the tariffs, but are also seeking to strengthen trade relations with other countries to protect the economy from further potential shocks.

‘Yippy’

Chancellor Rachel Reeves will seek to negotiate with the US when she visits Washington at the end of April for the International Monetary Fund’s spring meeting of global finance ministers, she told the Financial Times.

She also said a UK-EU summit on May 19 would be a chance “to refresh our relationship and make it easier for businesses to trade”.

Mr Trump said on Wednesday that he would pause higher tariffs on trading partners such as Japan and the EU, telling reporters that “people were getting yippy” in an apparent acknowledgement of the market turmoil in recent days.

However, he said he would be raising his tax rate on Chinese imports to 125% amid an escalating trade war with Beijing, which has promised to “fight to the end” over the levies imposed by the White House.

Imports of cars, steel and aluminium to America are all still subject to a 25% tariff.

Meanwhile, Kemi Badenoch called on the Prime Minister to convene members of a trans-Pacific trading agreement, including Mexico, Canada, Australia and Japan, to discuss ways to mitigate the impact of US tariffs.

The Conservative leader told the BBC: “All those countries are feeling the brunt of US tariffs.

“What I would be doing if I was prime minister is convening those countries to see what we can do to make life easier for the citizens of our various countries.”