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Donald Trump’s escalating trade tariffs are “deeply concerning” for the UK’s economic growth prospects, business groups and trade unions have warned.
The US President imposed global tariffs on steel and aluminium on Tuesday night, while raising a flat duty on steel and aluminium entering America to 25%.
The Confederation of British Industry (CBI) warned against “protectionism” as the UK Government seeks to boost domestic business confidence and economic growth.
John Foster, chief policy officer at the CBI, said: “At a moment in the economic cycle when boosting business confidence and unlocking firms’ capacity for investment holds the key to kick-starting economic growth, the escalating tariff situation in the US remains deeply concerning.
“Rather than heeding the siren calls of protectionism, major global players should be leaning into the significant economic benefits that free, fair and open trade can bring.”
Britain has resisted taking immediate retaliatory action against the move, while the European Union has already announced it will introduce counter-measures on American goods.
William Bain, head of trade policy for the British Chambers of Commerce, said the decision plunges both countries “into a new age of uncertainty”.
He warned against a series of “tit-for-tat” tariffs that could “easily spiral into an all-out trade war”.
Labour has made boosting economic growth a key priority but it has been sluggish in recent months, and experts have warned more aggressive US trade policy will hinder it further.
Last week, Bank of England governor Andrew Bailey told MPs the risks to the UK economy are “substantial” and that more tariffs would ultimately mean less money in UK consumers’ pockets.
The Government estimates around 5% of UK steel exports and 6% of aluminium exports by volume go to the US, although trade bodies for both industries claim that is an under-estimate of the impact.
Julia Pyke, joint managing director of the Sizewell C nuclear plant, said the company, which is one of the country’s biggest domestic steel buyers, was still committed to sourcing from UK producers.
She said the UK’s domestic steel industry is “critical for energy security, infrastructure, and net zero”.
Ms Pyke said Sizewell C “remains committed to maximising UK steel throughout our construction plans, including a £700 million steel pipeline over the next decade”.
But the tariffs nonetheless sparked warnings of job losses in Britain’s metal industries.
Gareth Stace, director-general of UK Steel, branded the Trump administration’s move “couldn’t come at a worse time for the UK steel industry as we battle with high energy costs and subdued demand at home”.
Alasdair McDiarmid, assistant general secretary of the Community union, added that the tariffs are “hugely damaging and they threaten jobs”.
