Prime Minister Keir Starmer is locked in tense last-minute negotiations with the Trump administration as Britain seeks exemption from sweeping new tariffs set to take effect this week. The proposed measures, including a 25% levy on British car exports, could devastate key UK industries and erase the government’s hard-won £10 billion fiscal buffer.
Downing Street has adopted a carefully calibrated stance, with a senior official warning: “We’ll be approaching this with cool calm heads, but sharp teeth.” Behind closed doors, officials are preparing retaliatory measures should negotiations fail, though both sides appear keen to avoid targeting the crucial financial services sector that forms the backbone of Anglo-American trade.
The looming deadline has exposed political vulnerabilities for Starmer’s government, with opposition figures accusing ministers of “dropping the ball” on trade preparations. Shadow Business Secretary Andrew Griffith pointedly noted that six months have passed since former PM Kemi Badenoch first urged action on a US trade deal, with little visible progress.
Market jitters have spread globally following Trump’s announcement, with Asian indices tumbling and Wall Street analysts dramatically increasing US recession forecasts. The economic uncertainty compounds challenges for Chancellor Rachel Reeves, whose recent budget measures to restore fiscal headroom could be undone by the tariffs.
As negotiations enter their final 48 hours, the Prime Minister faces a delicate balancing act – protecting British exporters while preserving the special economic relationship. The outcome may hinge on finding compromise over secondary issues like digital taxes or agricultural standards, with both sides aware that a full-scale trade war would carry heavy costs for workers and businesses on both sides of the Atlantic.
