As the UK imposes tariffs on US goods amidst Brexit tensions, a global stock market sell-off has been triggered. With 10% tariff rates coming into effect, the UK government is preparing for a potential trade war with Washington.
Trump’s 10% Tariffs on UK Products Come into Effect as Starmer Weighs Response
The 10% tariff imposed by Donald Trump on UK products came into effect at 12:01am ET (0401 GMT) on Saturday, sparking a global stock market sell-off. The initial ‘baseline’ tariff has ushered in Trump’s full rejection of the post-World War II system of mutually agreed tariff rates.
Response from Downing Street
UK Prime Minister Keir Starmer spoke to Australian Prime Minister Anthony Albanese and Italian Premier Giorgia Meloni on Friday, with officials stating that the leaders agreed that an all-out trade war would be ‘extremely damaging’. A spokesperson for Number 10 said that Starmer has been clear that the UK’s response will be guided by the national interest, and that officials will ‘calmly continue with our preparatory work‘ rather than rush to retaliate.
Keir Starmer is a British politician who serves as the Leader of the Opposition and the leader of the Labour Party.
Born on September 2, 1962, in Southwark, London, he was educated at the University of Leeds and the European University Institute.
A former human rights lawyer, Starmer entered politics in 2015, becoming the MP for Holborn and St Pancras.
He succeeded Jeremy Corbyn as Labour leader in 2020.
Government Preparations
Ministers have drawn up a list of products that could be hit in retaliation against Trump’s tariffs, and are consulting with businesses on how any countermeasures could impact them. Chancellor Rachel Reeves said that the government is ‘determined to get the best deal we can’ with Washington, while emphasizing the need to protect British jobs and industry.
Opposition Criticism
The Liberal Democrats have accused the government of failing to coordinate a response to Trump’s tariffs, and called on ministers to stand shoulder-to-shoulder with European and Commonwealth friends. The party’s leader, Ed Davey, stated that the best way to end this crisis is to strengthen trading relations with reliable allies.
Global Market Impact
The imposition of Trump’s tariffs has sparked a global stock market sell-off, with the FTSE 100 plummeting on Friday in its worst day of trading since the start of the pandemic. Markets on Wall Street also tumbled. Beijing has announced that it will respond with its own 34% tariff on imports of all US products from April 10.
UK Response
Keir Starmer is expected to spend the weekend speaking to foreign leaders about the tariffs, following calls with Albanese and Meloni on Friday. The UK government’s approach to the tariffs has been described as ‘calm’ by officials, but critics have accused them of failing to take a firm stance against Trump’s policies.
Reciprocal Tariffs
Many other countries will see their tariff rates increase above 10% next week, including the EU which will be hit with a 20% rate. A 25% tariff imposed on all foreign cars imported into the US came into effect on Thursday.
