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 international 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 outstanding position 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 resembling fishing and petroleum going through sharp declines.
“Most UK industries . . . will face steep challenges if the US goes forward with the proposed tariffs,” stated UKTPO economist Nicolò Tamberi, although he added textiles “might even see beneficial properties from commerce shifts as a result of diminished Chinese language competitors within the US market”.
The Nationwide Institute of Financial and Social Analysis stated tariffs of 10 per cent would minimize forecast GDP development by 0.8 share factors subsequent yr, and trigger a 1.4 share level discount in 2026.
Ahmet Kaya, principal economist at Niesr, stated greater costs would hit lower-income households hardest. “Trump’s proposed tariffs can be yet one more shock to the UK financial system,” he added.
The prospect has despatched shockwaves by Whitehall. “This has the potential to be as problematic for us as Brexit,” stated one British authorities determine.
Overseas and defence
Trump has pledged to “finish wars”, a noble ambition that poses issues for a world at present enmeshed in a number of conflicts.
The UK’s steadfast assist for Ukraine underneath successive Tory and Labour administrations may very well 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 elevate defence spending to 2.5 per cent of GDP — in contrast with 2.3 per cent at present — there are questions over whether or not European states may present plug the army and monetary hole if the US, which has supplied a significant proportion, pulls again.
Trump’s place can 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 could 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 outcomes point out, no less than partially, American voters’ repudiation of the Democratic celebration’s insurance policies in Gaza and the failure to barter a ceasefire deal, it’s tough to see how a Trump administration will pivot to enhance the scenario.”
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 drive Britain and Europe to shoulder way more of the burden of securing their very own area, above and past present deliberate will increase.
Whereas the prime minister want to focus expenditure on vote-winning areas just like the NHS and schooling, he might but be pressured to pour much more money into Britain’s armed forces.
Strategic rivalry between the US and China is in the meantime more likely to intensify underneath Trump, which may have penalties for London.
Throughout his first time period, Trump pressured Britain to fall into line on Beijing, resembling banning know-how manufactured by Chinese language firm Huawei from the UK’s 5G rollout.
Expertise
Governments all over the world are drawing up guidelines to control how AI is developed and used, making the following few years key to the secure rollout of the rapidly-evolving know-how.
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 know-how lobbyist warned. “To me, the downsides are fairly vital” for the UK’s position in tech, they added.
Huge Tech firms are more likely to be emboldened by Trump to struggle towards European-style regulation of the trade, 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 high tech trade 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 power.
Labour ministers are privately aghast at Trump’s method to local weather change however some imagine that Europe may turn 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 this planet with a extra interventionist method to inexperienced power than the earlier Tory administration.
Trump’s victory can 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 resembling French President Emmanuel Macron and EU president Ursula von der Leyen had already dropped out even earlier than the US election.