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Lib Dems call on the government to release analysis of potential Trump trade war 

The Liberal Democrats are tabling a ‘Humble Address’ motion which would force the Government to release its analysis of the potential impact of Trump’s tariffs on the UK economy
Lib Dem Leader Ed Davey - Image: House of Commons
Lib Dem Leader Ed Davey - Image: House of Commons

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With Trump’s inauguration on the horizon, fears are growing about what a trade war could mean for the UK economy. During the first Trump administration the UK wasn’t impacted too badly by the introduction of US import tariffs, but with escalating fears of a geopolitical competition between some of the world’s biggest economic powers there are concerns that a tariff war would severely impact the UK.

During Trump’s first administration it was China that felt the brunt of Trump’s economic policies with tariffs of 20% on imports, however, this time round there has been a notable shift in trade policy with estimates of up to 60% tariffs on US imports from China. The policy seeks to support higher domestic production as well as increased government revenue although there are concerns that there may be retaliatory tariff increases sparking a ‘trade war’.

Research from the University of Sussex suggests that the new U.S administration’s plans may include tariffs of up to 20% on UK exports, which could hit the UK economy by £22bn. Data from the UK government in 2023, highlights how the U.S is one of the UK’s biggest trading partners as it accounted for 21.7% of the UK’s export markets for goods and services in 2023.

Due to concerns about the implications of the incoming U.S administration’s trade policy, the Liberal Democrats are calling for a Humble Address motion. This is a rarely used parliamentary procedure that allows the House of Commons and Lords to petition the Monarch and HM government to order documents to be produced. 

Despite their rarity, they have been successfully used in the past, this was illustrated in 2017 when the UK government was ordered to publish an impact assessment of Brexit on the UK economy. 

Ed Davey, Leader of the Liberal Democrats, said:

“Many families who are already struggling with the cost of living will be worried about what Trump’s Presidency and a potential trade war might mean for them”

“The least the British public deserve is for the Government to be transparent about how Trump’s tariffs might hit their pockets. The government must release their impact assessment now”

Ed Davey also highlighted the need to strengthen the UK-EU relationship due to the potential economic challenges posed by the Trump administration and the need to put the UK in a stronger negotiating position.

“Ministers need to also urgently start talks on a new UK-EU Customs Union, to boost our economy and allow the UK to negotiate with Trump from a position of strength”

This comes after Ed Davey argued in a speech on Thursday that the UK needs to rejoin the EU customs union to boost the British economy and combat the potential challenges of the incoming Trump administration.

The speech was highly critical of the incoming president describing him as “the first convicted criminal to take the oath of office”. There were also hits at some of Trump’s major policies in his first term including leaving the Paris Agreement, Iran Nuclear Deal and the UN Human Rights Council.

It is clear that the Trump administration poses great concern to Ed Davey and the Liberal Democrats as he criticised the approach made by the Conservatives and Reform UK “if we seem as weak or as desperate as the Conservatives or Reform would have us appear, Trump will treat the UK the same way he has treated so many throughout his career”. 

The Liberal Democrats are keen to move the UK closer to Europe calling on Prime Minister Sir Keir Starmer to do more to strengthen the UK-EU relationship in order to best prepare the UK for potential tariffs and changes to US-UK trade policy.

The call on the government to release the trade analysis hopes to inform the British public on how the incoming U.S administration may impact their financial situation and the UK economy. As the world anticipates Trump’s inauguration and the implications of his policies there is no doubt that there is uncertainty on how this may impact the ‘special relationship’ between the UK and the U.S and whether the UK will seek to strengthen other relationships around the world.

To follow the progress of this story and Trump’s inauguration make sure to follow Politics UK and Politics Global on X. 

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