Chancellor Rachel Reeves has issued a stark warning that Donald Trump’s aggressive tariff policy will have a “profound” impact on the global economy and urged leading nations to unite in defence of free trade.
Reeves called for a global “fightback” against protectionism as she prepares to attend a key meeting of the International Monetary Fund later this month. While she stopped short of directly criticising the U.S. President, she made clear that his sweeping levies on imports threaten economic stability and consumer costs, especially for British families already facing pressure from the cost-of-living crisis.
“We understand the benefits of free and fair trade and collaboration,” she wrote. “Now is not the time to turn our backs on the world.”
In a shift from the isolationist tone seen under recent governments, Reeves outlined plans for a reinvigorated internationalist trade agenda. That includes pursuing a deeper economic partnership with the European Union, a trade deal with India, and pushing for fairer global trading rules through multilateral bodies like the World Trade Organization.
Reeves’ comments come amid growing fears in Westminster over the long-term fallout from Trump’s tariffs including a 125% levy on Chinese imports, from which only smartphones, computers, and key components like memory cards and semiconductors have been spared.
To help mitigate the domestic impact, ministers are set to announce a multibillion-pound boost in government-backed financial support for British firms. UK Export Finance will be authorised to expand its lending capacity by £20 billion, while the British Business Bank’s growth guarantee scheme will offer loans of up to £2 million to small businesses.
Business Secretary Jonathan Reynolds said the measures are part of a “plan for change” to support UK industries through global economic turbulence.
Former Prime Minister Gordon Brown has also entered the fray, simultaneous breakdown in economic and geopolitical orders.” He called for an “economic coalition of the willing” to coordinate policy responses and safeguard jobs and living standards across continents.
Reeves echoed Brown’s call for coordinated action, stating the Labour government remains committed to global partnerships, not isolation. “The Labour Party is an internationalist party,” she said.
With pressure mounting on the UK to redefine its trade identity post-Brexit, Reeves’ intervention signals a clear pivot back towards global collaboration even as major economic powers like the US move in the opposite direction.
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