Trade: US Tariffs

12. What recent discussions he has had with his US counterpart on tariffs.

As we have heard, the US is our largest single country trading partner, with total trade worth £315 billion in 2024, representing 18% of total UK trade. More than a million Americans work for UK-owned businesses and vice versa. We have regular and ongoing constructive negotiations with our US counterparts, including some this week, on securing a wider economic deal to benefit UK businesses and our economy. In those talks, we continually push the case for free and open trade. Nobody wants to see a trade war, so our focus is on keeping calm and continuing to negotiate in the interest of UK businesses and consumers.

As the UK’s top export country, the US is a vital partner to many UK businesses, but with Trump now reported to have made the UK a second-order priority to Asia and with the UK possibly on the verge of giving up its Brexit freedoms in favour of EU alignment, how confident is the Secretary of State of achieving a comprehensive free trade deal with the US, in both goods and services?

First, let me assuage the hon. Gentleman’s concerns: that is a misreading of how the US is approaching these negotiations. The US has perhaps more complex issues with some countries that will take more bandwidth on its side. As I have always said, the existing relationship between the UK and the US is incredibly strong, reciprocal and mutually beneficial. I see far fewer issues to negotiate to get to that outcome.

Again, I would push back on anyone attempting to put the case that the decisions we make must be based on either the EU, the US or any other partner being our principal partner. The role for the UK is to position ourselves in this challenging world with a genuine strategic advantage because we do things that improve our trading relationship with the EU; we secure this US deal; and we secure the deals with India, the Gulf and other key markets. I am pragmatic about where the UK’s national interest lies and am absolutely confident that it is possible and desirable.

I call the Chair of the Select Committee.

Today the Select Committee writes to the Secretary of State to supply our response to his consultation on how we should respond to American tariffs. We have heard widespread consensus that there should not be retaliatory tariffs and that the approach the Government are pursuing is right, but we have also heard real concerns especially in the automotive industry among those big exporters to America and, crucially, their supply chains. Can the Secretary of State reassure the House that he is readying support packages across Government to ensure that our automotive sector does not run into serious trouble if we cannot get a deal with America soon?

As my right hon. Friend knows, I always welcome communications from the Select Committee and the constructive and helpful role it plays in all these important matters. He is right to say that the business community in the UK strongly backs the Government’s calm and level-headed approach to these difficult issues. The automotive sector is one of our major priorities. It is the sector that has the most exports because of the brilliant success we have with automotive exports to the US. It remains an absolute priority for us in any negotiation to secure what we need, which is the continuation of access to US markets in a way that is complementary to the US and that meets the ambitions of US consumers. Frankly, I do not see any argument for making that relationship more difficult through the long-term imposition of tariffs. We are closely engaged in a number of important meetings this week with senior automotive leaders, and we will continue to prepare that, working to keep the Select Committee involved.