UK won’t engage in ‘kneejerk’ response to Trump tariffs, says minister
The UK government will not engage in a “kneejerk” response to any tariffs imposed by Donald Trump, as it warned there will be a “difficult period” ahead in trade relations with the US and called for calm.
The US president is to announce his latest round of tariffs on Wednesday – which he has called “liberation day” – sparking concerns over a global trade war.
The prime minister, Keir Starmer, and the chancellor, Rachel Reeves, will face questions from MPs in parliament before the anticipated new tariffs that could derail their economic plans. Speaking before the announcement , the education secretary, said the government had been “working through every eventuality”.
“We do recognise this is likely to be a very challenging period,” she told BBC Breakfast. “We still have negotiations under way with our US counterparts about securing an economic deal, but we will always act in the national interest and the interest of the British people.”
Phillipson said the government would “always act in the national interest and the interest of the British people”, adding: “I think what they want, and what business and industry wants, is to for us to maintain a calm and quite pragmatic approach during this time and not engage in a kneejerk response, because the last thing that anybody would want is a trade war with the US.”
Since taking office, Trump has rattled global stock markets and caused consternation among business leaders by announcing and delaying plans to impose tariffs on foreign imports.
The threats have soured US relations with its largest trading partners. Canada’s prime minister, Mark Carney, has called them “unjustified” and said his country would react robustly. The European Union has said it has a “strong plan” to retaliate.
Asked whether the government would consider abandoning its fiscal rules in the event of exceptional trade circumstances, Phillipson said “fiscal rules do matter”.
“They matter because we have to demonstrate that we have a clear sense about how we manage the public finances,” she told Sky News.
“I think your viewers will have seen in recent years with the Liz Truss government, what happens when you have a government that doesn’t have a grip on the public finances and isn’t prepared to make choices about priorities, and our fiscal rules are important, and they do matter.”
Speaking about the government’s announcement of up to 4,000 new childcare places in new or expanded school-based nurseries, Phillipson said it was the “first step” towards achieving the 100,000 places promised by Labour last year.
“We know the difference that early years education makes to children’s life chances, and also your viewers will know how important it is that they can access childcare places,” she said.
