Trump’s Steel Tariffs a ‘Negative’ Move for Both UK and US, Says Business Secretary
UK Business Secretary Jonathan Reynolds has warned that President Trump’s 25% tariffs on steel imports, set to come into effect in March, could have damaging consequences for both the UK and the US. Speaking to the BBC, Reynolds emphasized the mutual interest in securing an exemption from the tariffs, which could hurt both nations’ economies.
Reynolds highlighted the unique trading relationship between the UK and the US, noting that the UK exports specialized steel products, such as Navy submarine casings made in Sheffield, which are crucial to the US. He stressed that imposing tariffs on UK steel would not only harm the UK economy but would also increase costs for US taxpayers, as these specialized materials are vital for US industries. The UK government has already pledged up to £2.5bn to support the country’s steel industry, which has faced numerous challenges in recent years, including job losses and competition from cheap imports. Reynolds noted that while the US government has insisted there would be “no exceptions or exemptions” to the tariffs, he has engaged in “constructive conversations” with officials in the Trump administration, acknowledging the UK’s different trading position from the EU or China.
The UK steel industry, which accounts for about 10% of British steel exports to the US, is concerned that the tariffs will not only limit exports but could also lead to an influx of cheap steel from other countries, potentially undercutting the UK’s domestic steelmakers. UK Steel, the body representing the industry, called the tariffs a “devastating blow” to the sector, which contributes £400m annually to UK-US trade. While the UK is not a major supplier of steel to the US, the government’s plan to mitigate the impact of tariffs includes encouraging greater use of UK-made steel in domestic infrastructure projects and supporting the adoption of more sustainable manufacturing technologies, such as electric arc furnaces, which are less energy-intensive than traditional blast furnaces.
Reynolds acknowledged that the transition to new technologies would lead to a reduction in headcount in some areas, but stressed that increasing demand for UK steel could help offset some of the job losses. He added that the government’s consultation on a new “Plan for Steel” would address long-term issues in the sector, including the impact of cheap imports and rising energy costs. Meanwhile, the GMB union welcomed the government’s support but warned that the steel industry still faces significant uncertainty, with the threat of retaliatory tariffs and increasing competition from countries with more favorable business conditions. Gareth Stace, director-general of UK Steel, expressed hope that a robust steel strategy could reverse the sector’s decline, particularly as the UK faces rising competition from imports. The UK government is also preparing for potential retaliatory tariffs and is working with stakeholders to develop a comprehensive steel strategy, set to be launched in the spring. Despite the challenges, Reynolds remained optimistic about the UK’s ability to navigate the situation and secure a favorable outcome for both steelworkers and the wider economy.
