Sir Keir Starmer might have despatched his “hearty” congratulations to Donald Trump on his victory within the US presidential election this week, however there are a variety of coverage areas the place the UK authorities is poised to conflict with the incoming Republican administration.
The prime minister might want to strike a balancing act: sustaining goodwill with the following White Home to work collectively on thorny world points, whereas guaranteeing he doesn’t alienate home voters who largely take a dim view of the president-elect.
Whitehall insiders are additionally bracing for character clashes, notably with Elon Musk, who’s tipped for a distinguished function in Trump’s crew and has revelled in utilizing his social media platform to goad Starmer and criticise the UK.
Tariffs
Economists have warned Trump’s risk to impose 10-20 per cent tariffs on all imports into the US — and 60 per cent tariffs on Chinese language items — would hit UK commerce and funding.
A sector-by-sector evaluation by the Centre for Inclusive Commerce Coverage at Sussex College forecast Trump tariffs may trigger a £22bn annual hit to UK exports, with key sectors akin to fishing and petroleum going through sharp declines.
“Most UK industries . . . will face steep challenges if the US goes ahead with the proposed tariffs,” stated UKTPO economist Nicolò Tamberi, although he added textiles “may see gains from trade shifts due to reduced Chinese competition in the US market”.
The Nationwide Institute of Financial and Social Analysis stated tariffs of 10 per cent would lower forecast GDP progress by 0.8 share factors subsequent yr, and trigger a 1.4 share level discount in 2026.
Ahmet Kaya, principal economist at Niesr, stated increased costs would hit lower-income households hardest. “Trump’s proposed tariffs would be yet another shock to the UK economy,” he added.
The prospect has despatched shockwaves by means of Whitehall. “This has the potential to be as problematic for us as Brexit,” stated one British authorities determine.
International and defence
Trump has pledged to “end wars”, a noble ambition that poses issues for a world presently enmeshed in a number of conflicts.
The UK’s steadfast assist for Ukraine below successive Tory and Labour administrations could possibly be severely undermined by the president-elect, who has indicated his need for Kyiv to agree a swift take care of Moscow, triggering nervousness concerning the prospect of him urgent Ukraine to just accept phrases.
Whereas Starmer has promised the UK will increase defence spending to 2.5 per cent of GDP — in contrast with 2.3 per cent presently — there are questions over whether or not European states may present plug the army and monetary hole if the US, which has supplied a serious proportion, pulls again.
Trump’s place may even have a bearing on Israel’s conflicts with Hamas in Gaza and Hizbollah in Lebanon, though it stays to be seen how a lot leverage he can have over Israeli Prime Minister Benjamin Netanyahu.
The UK authorities has more and more stepped up strain on Israel to ease the humanitarian disaster within the area and to indicate restraint in direction of Iran to keep away from spiralling battle within the area.
Dr Burcu Ozcelik, senior analysis fellow on the Rusi think-tank, stated: “If the election results indicate, at least partially, American voters’ repudiation of the Democratic party’s policies in Gaza and the failure to negotiate a ceasefire deal, it is difficult to see how a Trump administration will pivot to improve the situation.”
Nato
Trump has beforehand expressed ambivalence about Nato. Any transfer by him that solid doubt on Article 5 — the precept of collective defence that lies at its coronary heart — may pressure Britain and Europe to shoulder much more of the burden of securing their very own area, above and past present deliberate will increase.
Whereas the prime minister wish to focus expenditure on vote-winning areas just like the NHS and schooling, he might but be compelled to pour much more money into Britain’s armed forces.
Strategic rivalry between the US and China is in the meantime prone to intensify below Trump, which may have penalties for London.
Throughout his first time period, Trump pressured Britain to fall into line on Beijing, akin to banning expertise manufactured by Chinese language firm Huawei from the UK’s 5G rollout.
Know-how
Governments world wide are drawing up guidelines to manipulate how AI is developed and used, making the following few years key to the secure rollout of the rapidly-evolving expertise.
Trump has stated he plans to scrap the Biden administration’s Govt Order on AI — which was tied carefully to the UK’s AI Security Summit final yr.
The transfer would put the US on a collision course with the UK authorities on regulation, one UK-based expertise lobbyist warned. “To me, the downsides are quite significant” for the UK’s function in tech, they added.
Huge Tech corporations are prone to be emboldened by Trump to battle towards European-style regulation of the business, such because the UK’s On-line Security act and new Digital Markets Unit regulator.
Policing of on-line actions is an space the place Musk, Trump’s prime tech business ally, has already clashed with the UK. The X proprietor repeatedly likened the UK to the Soviet Union for its policing of offensive speech after far-right riots unfold throughout the nation in August.
Local weather
An avowed local weather change sceptic, Trump promised whereas campaigning to extend drilling for fossil fuels within the US and vowed to repeal the Inflation Discount Act, Joe Biden’s flagship laws to encourage funding in clear vitality.
Labour ministers are privately aghast at Trump’s strategy to local weather change however some consider that Europe may develop into a comparatively extra engaging place for low-carbon funding within the coming months.
The Starmer authorities will pitch Britain as some of the politically steady international locations on the planet with a extra interventionist strategy to inexperienced vitality than the earlier Tory administration.
Trump’s victory may even overshadow the UN COP29 local weather talks in petrostate Azerbaijan subsequent week, given the president-elect’s promise to withdraw from the 2015 Paris settlement — as he did throughout his first time period within the White Home.
Starmer is attending the COP talks in Baku however different main political figures akin to French President Emmanuel Macron and EU president Ursula von der Leyen had already dropped out even earlier than the US election.
