BRITAIN will not respond to Donald Trump’s punishing tariffs this week with “knee jerk” reaction, Sir Keir Starmer says.
The Prime Minister insisted that he could still push ahead with retaliatory tariffs but doesn’t want the UK embroiled in a trade war.
AFPSir Keir Starmer says there will be no “knee jerk” reaction to Donald Trump’s tariffs[/caption]
Negotiators have been trying to obtain a carve-out from the US-billed “liberation day” tariffs that are set to kick in from Thursday morning.
But Downing Street have conceded that an economic deal is unlikely to be struck before the deadline – but talks will continue.
Sir Keir said: “The likelihood is there will be tariffs. Nobody welcomes that.
“We are obviously working with the sectors most impacted at pace on that. Nobody wants to see a trade war but I have to act in the national interests.”
The pending tariff war comes as growth figures from last week show the economy is flat-lining.
There was zero growth between July and September and only 0.1 per cent growth between October to December.
Sir Keir added that business want a “calm and collected response to this, not a knee-jerk”.
His intervention comes after he spoke to Trump on Sunday night but no agreement could be struck.
He told Sky News: “We are of course negotiating an economic deal which will, I hope… mitigate the tariffs.”
When asked if he had been played by Trump, he said: “The US is our closest ally.
“Our defence, our security, our intelligence are bound up in a way that no two other countries are.
“So it’s obviously in our national interest to have a close working relationship with the US, which we’ve had for decades, and I want to ensure we have for decades to come.”
He said talks on a deal would normally take “months or years” but “in a matter of weeks we have got well advanced in those discussions”.
Trump has said that there will be an eye-watering 25 per cent import tax on cars heading to the US in a blow to the UK.
Nearly one in five, some 17 per cent, of all car exports were sent to the UK as part of a £7 billion industry.
There could also be a general 20% tax on UK products in response to the rate of VAT which the President sees as discriminatory against the US.
The tariffs could be a bitter blow to the Treasury as the independent watchdog said the levies could wipe out the £9.9 billion headroom built up by Chancellor Rachel Reeves.
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