The British government will use “any powers” needed to protect the UK from the wider impact of global tariffs imposed by Donald Trump, the business secretary told Sky News.
Jonathan Reynolds told Wilfred Frost on Sky News Breakfast the 10% tariffs on UK goods into the US put the UK “in a relatively better position” than others, such as the EU which has had a 20% tariff placed on it.
He said the 10% is still a “disappointment” but warned his “job is not done” when it comes to negotiating a trade deal with the US after British trade teams failed to seal a deal before Mr Trump’s announcement on Wednesday.
Politics latest: Starmer says UK will react to tariffs with ‘cool and calm head’
Mr Reynolds refused to say if the tariffs, which saw a 54% tax on Chinese goods, might cause a global recession and said the UK has safeguards in place to ensure it is not flooded with goods that would have gone to other countries.
“We’ll take any powers we need to protect the British people and the British economy from that,” he said.
“What we have directly within our power, alongside that is, of course, the ability to negotiate a better deal in the national interest for the UK. That’s been our approach to date and we’ll continue with that.”
The business secretary also suggested if the UK is successful in negotiating a deal with the US “there’ll be a template there” for other countries to “resolve some of these issues”.
He reiterated statements he and Sir Keir Starmer have made over the past few days as he said: “America is a friend, America’s our principal ally.
“Our relationship is an incredibly strong economic one, but also a security one, a political one as well.”
Mr Reynolds admitted the UK may not agree with all of the US’ decisions but it was important to understand “where they’re coming from”, which he believes means the UK can have a “constructive conversation that will get the best for the UK.
In the immediate aftermath of Mr Trump’s announcement, Mr Reynolds released a statement saying: “We have a range of tools at our disposal, and we will not hesitate to act. We will continue to engage with UK businesses, including on their assessment of the impact of any further steps we take.
“Nobody wants a trade war, and our intention remains to secure a deal. But nothing is off the table, and the government will do everything necessary to defend the UK’s national interest.”
‘Get back round the negotiating table’, say Tories
The Conservative Party’s shadow business and trade secretary described the US president’s announcement as “disappointing news which will worry working families across the country”.
Please use Chrome browser for a more accessible video player
Sky’s Ed Conway examines how economies across the world are impacted by tariffs
Andrew Griffith hit out at the government for having “failed to negotiate with President Trump’s team for too many months after the election, failed to keep our experienced top trade negotiator, and failed to get a deal to avoid the imposition of these tariffs by our closest trading partner”.
“The chancellor’s emergency budget of just a week ago with its inadequate headroom is now at risk, casting uncertainty about more taxes or spending cuts,” he continued. “Sadly, it is British businesses and workers who will pay the price for Labour’s failure.”
He called on ministers to “swallow their pride” and “get back round the negotiating table to agree a fair deal to protect jobs and consumers in both the UK and the US alike”.
Liberal Democrat leader Sir Ed Davey has reacted furiously to Mr Trump’s announcement of a “destructive trade war”, and called on the government to stand up against “Trump’s attempts to divide and rule”.
“The prime minister should bring our Commonwealth and European partners together in a coalition of the willing against Trump’s tariffs, using retaliatory tariffs where necessary and signing new trade deals with each other where possible.”
Speaking on Wednesday evening at a White House event entitled ‘Make America Wealthy Again’, the US president unleashed sweeping tariffs across the globe.
Mr Trump held up a chart detailing the worst offenders – which also showed the new tariffs the US would be imposing.
The UK’s rate of 10% was perhaps a shot across the bow over the 20% VAT rate, though the president’s suggested a 10% tariff imbalance between the two nations. Nonetheless, tariffs of 10% could directly reduce UK GDP by between 0.01% and 0.06%, according to Capital Economics.
A 25% duty on all car imports from around the world is also being imposed from midnight in the US – 5am on Thursday, UK time.
Read more:
World reacts to Trump’s tariff announcement
Tariffs will have consequences for globalisation, the US economy and geopolitics
Trump’s tariffs explained
The UK government had been hoping to negotiate an economic deal with the US in a bid to avoid the tariffs, but to no avail. The government says negotiations will continue.
The Confederation of British Industry said “negotiating stronger trading relationships with all like-minded partners will be foundational to any success”.
The business secretary is expected to make a statement in the House of Commons on Thursday, and we are also expecting to hear from the prime minister.
Content Source: news.sky.com