Britain will go “further and faster” in lowering the barriers to trade with other nations in the wake of Donald Trump’s sweeping tariffs, the Prime Minister has said.
The UK is keeping its options on the table for retaliating to US tariffs "if necessary", Sir Keir Starmer told a senior group of MPs on Tuesday, as he vowed to “turbocharge” plans to boost the economy.
Asked about the Government's response to new import taxes, announced by the US President last week , Sir Keir told the Liaison Committee it was a “very challenging” situation for Britain and other countries around the world.
“I don’t think what has happened in the last few days is a temporary, passing phase,” he added.
“I think it's a changing world order....Therefore, I do think there are two ways in which our plans don’t so much change as turbocharge.
“The first is we have to do much more, further and faster in making sure our economy is resilient and thriving... Secondly, we have to talk to other like-minded countries about lowering the barriers to trade between us, and that's why I spent a great deal of the weekend on the phone to international leaders, partly gaging their response, exchanging notes, understanding how they were approaching the challenge, but also having a broader discussion about how they are likely to respond.
“So the priority of growth doesn't change, the fundamentals don't change. But in two respects, which is turbocharging the changes we need in our economy, yes that needs to go further and faster. I’m absolutely clear about that. And secondly lowering barriers to trade with other countries, again we need to go further and faster in my view.”
The Prime Minister said changes to the zero emissions vehicle mandate and clinical trials announced on Monday were aimed at paving the way to making the economy more resilient.
"Obviously we have to keep our options on the table and do the preparatory work for retaliation if necessary,” he told MPs.
"But I think that trying to negotiate an arrangement which mitigates the tariffs is better."
Asked if the Government could intervene to prevent recession, similar to steps taken during the Covid pandemic, the Prime Minister emphasised ministers were prioritising support that was "more in the nature of breaking down barriers that are in the way" rather than spending cash.
China accused Donald Trump of blackmail and vowed to “fight to the end” in a trade war after he threatened to impose 104% tariffs on the country.
In a statement issued on Tuesday, Beijing vowed to “resolutely take countermeasures to safeguard its own rights and interests”.
But buyers returned to the London stock market after a three day rout triggered by trade war threats. In early trading the blue chip FTSE 1000 index of leading shares rose almost 100 points, or 1.24%, to 7,797.49.
London’s top flight, slumped 352.90 points or 4.38% to 7702.08 on Monday on the third day of a $10 trillion meltdown on world stock markets.
