The United Kingdom's top finance minister is urging restraint as President Donald Trump ramps up a trade war with sweeping tariffs on foreign cars, warning that escalating tensions could hurt consumers and British exporters, The Hill reported.
Rachel Reeves, Britain's chancellor of the exchequer, said the U.K. does not want to exacerbate trade tensions with the United States following Trump's announcement of a 25% tariff on foreign-made cars and auto parts.
"We're not at the moment in a position where we want to do anything to escalate these trade wars. Trade wars are no good for anyone," Reeves said in an interview on Sky News.
"It will end up with higher prices for consumers pushing up inflation after we've worked so hard to get a grip of inflation, and at the same time, will make it harder for British companies to export," she added.
The newly announced tariffs are part of Trump's declaration of a broader trade war targeting nations that have historically had a large trade deficit with the United States.
On Wednesday, the president said the measures aimed to spur a national manufacturing revival. United Auto Workers President Shawn Fain backed the decision, though many international leaders have denounced the move as a "direct attack."
The European Union has since indicated it may impose retaliatory levies, and Canada has floated similar plans. Trump responded to the possibility of joint action with a threat of even harsher penalties.
"If the European Union works with Canada in order to do economic harm to the USA, large scale Tariffs, far larger than currently planned, will be placed on them both in order to protect the best friend that each of those two countries has ever had!" Trump wrote Thursday on Truth Social.
Economists and government bodies have expressed concern about the potential global fallout from the trade fight. The U.K.'s Office for Budget Responsibility warned that rising global tariffs could significantly affect Britain's economy.
"If global trade disputes escalate to include 20 percentage point rises in tariffs between the USA and the rest of the world, this could reduce UK GDP by a peak of 1 percent and reduce the current surplus in the target year to almost zero," the Office for Budget Responsibility said in a statement shared with Sky News.
Despite mounting pressure, Reeves emphasized that the U.K. remains committed to dialogue and economic cooperation with the United States.
"Look, we are looking to secure a better trading relationship with the United States. I recognize that the week ahead is important," Reeves said. "There are further talks going on today, so let's see where we get to in the next few days."
Reeves, who has secured 9.9 billion pounds ($12.9 billion) in fiscal "headroom" during her tenure, may face increasing difficulty balancing the budget as global trade becomes more volatile.
Observers say her cautious tone reflects the U.K.'s strategic interest in keeping trade flows open while avoiding confrontation with Washington.
Jim Thomas ✉
Jim Thomas is a writer based in Indiana. He holds a bachelor's degree in Political Science, a law degree from U.I.C. Law School, and has practiced law for more than 20 years.
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