In response to US tariffs, the UK states that "nothing is off the table."

 

In response to US tariffs, the UK states that "nothing is off the table." (Image: Getty Images)

Downing Street stated that "no one wants a trade war" but that "no reciprocal action is off the table" in the event that the United States does not honor its tariff agreement with the United Kingdom. On Tuesday, US President Donald Trump announced a 15 percent tariff on all nations. The prime minister's official spokesman said the "majority" of the UK-US deal, such as the tariffs on cars, steel, and pharma, was not expected to change, but described the situation as "evolving" and said discussions between the UK and US were ongoing.

 As a result of the 15% tariff announcement, the EU put on hold its US tariff agreement on Monday. The majority of Trump's global tariffs, which he had announced last year, were declared illegal by the US Supreme Court on Friday, claiming that the president had exceeded his authority. That decision had an effect on all tariffs that Trump had announced on "Liberation Day" last year using the International Emergency Economic Powers Act (IEEPA). Then, Trump said that a new 10% global tariff would take their place. On Saturday, he changed the rate to 15%. Under Section 122 of the 1974 Trade Act, that 15% tariff will be implemented as a temporary solution. The levy will not apply to certain goods, like essential minerals, metals, and pharmaceuticals. According to the findings of an analysis conducted by the think tank Global Trade Alert (GTA), the United Kingdom will be one of the nations that will suffer the most if the global tariff of 15% is implemented because it had negotiated a deal with the United States that included a tariff of 10%. In the meantime, China and Brazil, which currently have tariff rates that are higher, would benefit, according to the GTA. 

The tariffs on steel, aluminum, pharmaceuticals, automobiles, and aerospace, which account for the majority of the UK's trade with the US, are unaffected by the 15% global levy. The 15% global rate would only apply to sectors other than those for which the UK had negotiated separate sectorial tariffs. This is due to the fact that the Section 122 legislation that Trump has stated he will use to impose his 15% tariff differs from the method used to impose tariffs on specific sectors. Andy Haldane, president of the British Chamber of Commerce, told the BBC that Britain's trade partners would "sit towards the bottom of league table" if Trump's 15% tariff went into effect. He continued, "The perverseness of what happened over the weekend was that those who got good deals, the allies, have been the most disadvantaged." Greer, the US trade representative, told CBS on Sunday that over the weekend he had spoken with the EU and other nations. "The deals were not premised on whether or not the emergency tariff litigation would rise or fall," he said.

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 "These transactions are going to be beneficial. We anticipate supporting them. We anticipate that our partners will support them. The EU Parliament said on Monday that it would put the deal it had made with the US last year "on hold until further notice" in spite of Greer's assurances. "The situation is now more uncertain than ever," stated Bernd Lange, chair of the international trade committee in Parliament. In a subsequent social media post, he added, "Clarity and legal certainty are required before any further steps can be taken." In a possible reference to the EU's decision, Trump wrote on Truth Social on Monday that "Any Country that wants to "play games" with the ridiculous supreme court decision [...] will be met with a much higher Tariff, and worse, than that which they just recently agreed to".

 The official spokesperson for the British prime minister stated, "Our approach to the US has always been pragmatic." "We continue to have productive conversations with them, and those conversations are taking place at all levels; however, at this point, nothing is off the table." "Our focus is on constructive engagement with our counterparts in the United States to maintain the UK's competitive advantage because industry doesn't want to see a trade war in which both sides keep escalating the situation." Many UK exporters will be "concerned at the further prospect of trade disruption to goods entering the US market," according to Richard Rumbelow, director of international business at the manufacturing industry body Make UK. He continued, "Clarity is now urgently required on how UK exports will be treated when they arrive in the United States."

Source: BBC