What's happened
The UK is grappling with significant trade challenges following Brexit, with food exports to the EU dropping nearly £3 billion annually. Experts warn that incoming tariffs from President-elect Trump could exacerbate these issues, impacting UK firms and small traders particularly hard.
What's behind the headline?
Impact of Tariffs
- President-elect Trump's proposed tariffs of 10-20% on imports could lead to a trade war.
- UK firms exporting to the US may face devastating impacts similar to those experienced post-Brexit.
Economic Consequences
- The Resolution Foundation warns that tariffs could deepen the economic divide between the UK's goods and services sectors.
- Small traders, already struggling post-Brexit, may find it increasingly difficult to compete.
Political Ramifications
- Sir Keir Starmer's government faces pressure to strengthen ties with the EU to mitigate the impact of US tariffs.
- The lack of a veterinary agreement with the EU continues to hinder food exports, complicating trade further.
What the papers say
According to The Independent, the Resolution Foundation's report highlights that Trump's tariffs could hit UK firms as hard as Brexit's trade barriers. Emily Fry, a senior economist at the Foundation, stated, 'While Trump tariffs wouldn’t affect the UK economy as a whole as much as Brexit, their effect on firms who sell goods to the US could be stark.' Meanwhile, The Guardian reports that UK food exports to the EU have dropped by nearly £3 billion annually since Brexit, with industry groups urging the government to negotiate a veterinary deal to ease trade barriers. Emma Knaggs from the European Movement UK emphasized the need for a new SPS agreement to reduce red tape and facilitate smoother trade.
How we got here
Since leaving the EU single market in January 2021, the UK has faced new trade barriers, including physical checks and documentation requirements. This has led to a notable decline in food exports to the EU, with a report indicating a 16% drop in trade.
Go deeper
- What are the implications of Trump's tariffs?
- How has Brexit affected UK food exports?
- What steps is the UK government taking to address these trade issues?
More on these topics
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The European Union is a political and economic union of 27 member states that are located primarily in Europe. Its members have a combined area of 4,233,255.3 km² and an estimated total population of about 447 million.
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Sir Keir Rodney Starmer KCB QC MP is a British politician and former lawyer who has served as Leader of the Labour Party and Leader of the Opposition since 2020. He has been Member of Parliament for Holborn and St Pancras since 2015.
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Brexit is the withdrawal of the United Kingdom from the European Union. Following a UK-wide referendum in June 2016, in which 52% voted to leave and 48% voted to remain in the EU, the UK Government which was then led by Theresa May formally declared the c