Britain and the EU said they were assessing the implications of the US supreme court ruling against Donald Trump’s global tariffs, while business groups reacted to the court’s announcement with caution.
A spokesperson for Downing Street said: “The UK government is working with the US to understand how the overturning of Donald Trump’s tariffs by the supreme court will affect the UK but expects our privileged trading position with the US to continue.”
The UK was the first to strike a tariff deal with the US, with 10% tariffs on all imports from Britain, compared with a blanket 15% rate for the EU.
The EU said it was analysing the ruling while continuing its drive to work towards reducing the tariffs the US imposed on European exports.
The EU agreed the 15% tariff rate with the US at Trump’s Scottish golf course last July but 50% tariffs are still imposed on steel.
“We remain in close contact with the US administration as we seek clarity on the steps they intend to take in response to this ruling,” it said.
“Businesses on both sides of the Atlantic depend on stability and predictability in the trading relationship. We therefore continue to advocate for low tariffs and to work towards reducing them.”
Companies affected by the tariffs should be able to demand refunds from the US administration, though the mechanism for doing this remains unclear.
It is understood that tariffs on products such as steel will not be affected and are likely to remain in place. Some experts warned that the White House could switch to broader product-based tariffs affecting computer chips and agriculture, possibly adopting an even more draconian approach with higher tariffs.
John Denton, the secretary general of the International Chambers of Commerce, said there was “fresh uncertainty” for companies seeking to trade with the US.
“Many businesses will welcome the prospect of refunds following today’s ruling, given the significant strain that the IEEPA [International Emergency Economic Powers Act] tariffs have placed on corporate balance sheets in recent months.
“But companies should not expect a simple process: the structure of US import procedures means claims are likely to be administratively complex.”
William Bain, the head of trade policy at the British Chambers of Commerce, said that while the supreme court had clarified the use of executive powers to raise tariffs, it did “little to clear the murky waters for business”.
“If he wants to, [Trump] could use the 1974 Trade Act to impose even higher tariffs than the additional 10% levies that the UK and Australia have already been affected by in many goods sectors.
“We have recently agreed a good deal on pharmaceuticals, and we should focus on using the economic prosperity deal to ensure the UK gets the preferential treatment outlined there.”
An aerospace industry insider said: “It’s a relief that this has been declared, but I don’t think it’s that helpful for geopolitical tensions.
“We still have quite an unpredictable US administration, and I don’t think taking this sort of public chastising is going to go well for some trade relationships.”
On the stock markets, the UK’s FTSE 100 index hit a new intraday high after the supreme court ruling was announced on Friday, and closed 0.56% higher.
Exporters were among the risers, with the drinks company Diageo – whose Scottish whisky and Mexican tequila brands had been hit by Trump’s tariffs – jumping by 3.9%. The luxury fashion brand Burberry gained 3.3%.
Some European carmakers also benefited: Stellantis, whose brands include Citroën, Fiat and Vauxhall, rose by 2%.
US government bond prices fell, pushing up borrowing costs, as investors anticipated a loss of income from tariffs and the possibility that US companies could be eligible for refunds on import costs. The dollar weakened slightly.
Disclaimer : This story is auto aggregated by a computer programme and has not been created or edited by DOWNTHENEWS. Publisher: theguardian.com
