UK-US Trade and Tariffs

Anneliese Dodds Excerpts

Thursday 3rd April 2025 Commons Chamber

[Jonathan Reynolds]

I thank the shadow Secretary of State for his response and his tone in responding. I recognise his commitment to free trade and the case he has made for it. I believe it is something we broadly share. He asks for honesty—that is always good in Parliament—but he is a little bit flippant about the position we find ourselves in today. He mentions a series of countries—Christmas Island, Kosovo—that do not have the kind of complex trading relationship that we have with the United States.

The shadow Secretary of State can see from my tone, presentation and words that I am disappointed that we are in this position, but I look at the EU, facing a tariff of 20%; at Japan with 24%; at India with 26%; and at Canada and Mexico with 25% tariffs already in place. Yes, we are in a more favourable position compared with those key friends and allies, but we must go further, especially in relation to the tariffs on the automotive sector, which is a particular concern for me.

The shadow Secretary of State again brings up Brexit, which was perhaps not the Conservative party’s finest hour in preparing the state for large trade shocks, but let us pass over that. As the President of the Board of Trade, I am of the view that it is good that we can set our own trade policy, but I say to him and to all colleagues: is it not time that we try to unite the country for the future, rather than keep on harking back to the past? Is that not how we will find our way through this? Half the country voted one way, and half voted the other way, but let us build together and look to the future. It is the right way forward. My next point is very important: it is false to see this as a choice between working with the US and working with the EU. We can work in a way that is consistent with both, and we should all be committed to that.

The shadow Secretary of State also asked about the implications for the United Kingdom. Broadly, he asked me to reverse a series of policy choices made in the last 14 years; I will go through all of those. In relation to the spring statement, the Chancellor had already rebuilt the headroom substantially higher, due to the global turbulence, than that bequeathed her by the Conservative party.

On the Conservatives’ spending plans, they left no business rates relief whatever: it was a one-year relief, rolled over, that never had any longevity. I have not yet received any credible proposals on how their spending plans would be paid for, but I am always available to receive those in writing.

The shadow Secretary of State asks for reassurance, which we are always happy to provide on domestic policy changes. On things like the ZEV mandate for the automative sector, we are more pragmatic than the Conservative party was when in office. As he knows, the Department for Transport leads on that policy, but our response to the consultation on potential changes will be published soon. As colleagues would expect, I will not comment on the details of any negotiations with the US.

In our manifesto, we committed to the UK’s sanitary, phytosanitary and food safety standards system. Of course the Government will adhere to that. The shadow Secretary of State also knows that we are imminently preparing to publish our trade strategy, which covers a lot of these issues, particularly around support for exporters that we want to proceed with.

Northern Ireland is an incredibly important issue for all colleagues. The potential for a differential response from the European Union could lead to a difficult situation in Northern Ireland. As the Secretary of State highlights, the key policy is the duty reimbursement scheme, because goods entering Northern Ireland from the US that will not go into the wider single market are subject to the reimbursement programme. We must make sure that that works well. I recognise the points that he has made on it, and I will continue to update the House and all colleagues on our work in this area. I recognise how important and relevant it is to all our constituents, so we will endeavour to keep all colleagues updated on progress.

[Anneliese Dodds (Oxford East) (Lab/Co-op)]

Workers at BMW at Cowley are deeply concerned by the recent news. BMW is right that a trade war would have no benefits. The Secretary of State is right to engage calmly with his US counterparts, but what discussions has he had with his EU counterparts, given how integrated our automotive sector is with that of EU countries?

[Jonathan Reynolds]

My right hon. Friend is right that some of our iconic automotive manufacturing brands, such as BMW, Jaguar Land Rover and Aston Martin, have had particular success in the US market and are therefore exposed to tariffs. There is close co-operation in Government between the teams working on our EU reset and on our trade negotiations in this area, so I assure my right hon. Friend of the alignment, continuity and consistency of our policy.

My right hon. Friend will know that, along with the changes to domestic policies such as the ZEV mandate, there was significant money in the Budget for incentivising the roll-out of infrastructure for electric vehicles, and £2 billion has been put aside for the wider joint collaboration and research and development initiatives with the automotive sector, which remains a clear and consistent Government priority. I will keep my right hon. Friend updated given her particular constituency interest.