President Donald Trump has announced a new set of tariffs, imposing an immediate 10 per cent levy on all British exports to the United States as part of what he termed a “declaration of economic independence” for the US. This announcement was made during a speech in the White House Rose Garden at a “Make America Wealthy Again” event on what Trump designated as “liberation day.” The new tariffs are expected to take effect between April 5 and April 9, and while Trump described them as reciprocal—pointing to existing UK tariffs against the US—he reinforced that this decision marks a significant shift in America’s trade policy.

This move impacts approximately £60 billion worth of annual exports from the UK to the US, with economists already warning that the tariffs could entirely negate growth in the UK economy in the coming year. However, the UK has reportedly fared better than many other countries facing higher levies; the European Union will encounter a 20 per cent tariff, Japan a 24 per cent tariff, China a 34 per cent tariff, and Vietnam a staggering 46 per cent tariff. A source at Downing Street remarked, “We don’t want any tariffs at all, but a lower levy than others vindicates our approach… The difference between 10 and 20 per cent is thousands of jobs.”

In his address, Trump stated, “This is one of the most important days, in my opinion, in American history. It’s our declaration of economic independence.” He elaborated on his justification by listing grievances against trading partners, asserting that the US has been subjected to unfair economic practices from other nations.

The announcement sent shockwaves through global stock markets and drew immediate criticism from various sectors in the UK. The Society of Motor Manufacturers and Traders responded by describing the tariffs as a “deeply disappointing and potentially damaging measure.” The British car industry, in particular, has been hit hard with the imposition of a 25 per cent tariff on foreign cars entering the US, leading to fears that this could jeopardise around 25,000 jobs across the country.

In contrast, UK Chancellor Rachel Reeves acknowledged the precarious situation the UK faces but stressed the government’s intention to navigate negotiations carefully to secure a workable trade agreement. She expressed the need for a coherent strategy rather than a hasty response, saying, “We don’t want to be posturing… the prize on offer is a good economic agreement.” During talks in Parliament, Leader of the Opposition Sir Keir Starmer conveyed the government’s awareness of the impact that the tariffs would have and stressed the necessity for calm and pragmatic approaches to mitigate the fallout.

The implications of Trump’s announcement are widespread, affecting numerous sectors from automotive to pharmaceutical to agriculture. Companies such as AstraZeneca and GSK heavily depend on the US market, with significant portions of their revenue coming from American sales. Similarly, the Scotch Whisky Association expressed disappointment, fearing the tariffs could mirror the devastating effects of previous tariffs that cost the whisky industry over £600 million in sales.

Moreover, the luxury retail sector, represented by iconic brands like Burberry, is also bracing for a decline in demand due to higher costs associated with tariffs. British Steel and Rolls-Royce, key players in their respective industries, have also signalled concerns regarding the sustainability of their operations under the new tariffs.

While British officials prepare for potential retaliatory measures and ongoing negotiations, many analysts remain sceptical about the possibility of a successful trade deal that would alleviate the burdens posed by the new tariff regime. Economic institutions and think tanks have warned that a full-blown trade war could lead to significant disruptions in trade flows and adversely impact consumer prices and economic performance on both sides of the Atlantic.

Source: Noah Wire Services