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    In the face of Trump’s mayhem, Europe is the direction to which the UK must turn – and Keir Starmer knows it | Tom Baldwin

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    Keir Starmer was back at the Emirates Stadium on Tuesday to watch Arsenal’s 3-0 win over Real Madrid, a result that far exceeded expectations of his team’s chances in Europe. And, over the next few days, I wouldn’t be surprised if he tries to snatch a short Easter break in the warmth and sunshine of that same continent.Football and family holidays offer him some much needed relief from the grim reality of a faltering economy, towering public debt and terrifying global insecurity, which are all being made worse on a daily – sometimes hourly – basis by Britain’s closest ally of the previous 80 years.But that mayhem being caused by Donald Trump’s extended stag party in the White House means that Europe is much more than an occasional distraction for the prime minister. Slowly, if not always surely, it is once again becoming the direction towards which Britain must turn.This is not exactly where Starmer thought he would to be. For all his talk of an EU “reset”, the plan had been to “make Brexit work” within self-imposed “red lines” ruling out joining the single market or a customs union, blocking freedom of movement and appearing to allow only some minor mitigation of the damage done by Boris Johnson’s deal.In the immediate aftermath of Trump’s inauguration, new horizons on the other side of the Atlantic briefly seemed rather more exciting. There was genuine interest in, if not admiration for, this insurgent disruptor of the US’s stuffy political establishment. There was also a prospect that Britain might gain advantage over the EU from a repurposed special relationship being gilded by inviting Trump to hang out with the royals.And, even now, securing some sort of US trade deal that might save thousands of British jobs, or the promise of the minimal military cooperation needed to maintain European security, are still prizes worth having. It’s silly to blame Starmer for trying to win them, or to expect him to strike poses against Trump for the sake of cheap headlines and not much else.What’s changed, however, is a recognition around the cabinet table that the US president is much more of a problem than part of any solution. Gone are the days when a government source would brief it had more in common with Maga Republicans than US Democrats, or Rachel Reeves could tell Britain to learn from Trump’s optimism and “positivity”. Nowadays ministers say it has become almost futile to anticipate his next move because “he’s only ever reliable in his unpredictability”. Whatever happens next, this is a US administration that can’t be regarded as a stable ally either on the economy or security.Those who think Starmer, in his repeated calls for “cool and calm heads”, is still being excessively polite have perhaps been too busy complaining to have noticed a subtle shift in his language. For instance, when the Times last week ran the headline: “Why Keir Starmer hopes Trump’s tariffs could be good news for the UK”, the rebuttal came from the prime minister himself, with an article in the same newspaper the next day, which began by stating: “Nobody is pretending that tariffs are good news.”View image in fullscreenOne well-placed Downing Street adviser now describes how Trump “wants to destroy the multilateral institutions” that Starmer believes are essential “to span divides and bring the world together”. Another mentions polling evidence that apparently shows even if a big US trade deal can be done, British voters would still prefer closer links to the EU because they don’t trust Trump to deliver.Certainly, efforts to reset those relations have been pursued with more vigour over recent weeks. These began with Starmer’s “coalition of the willing” to replace the military support for Ukraine that Trump appears so intent on taking away, and will continue ahead of the EU-UK summit on 19 May. More focus on shared interests and values and less on “red lines” should mean a security and defence pact is agreed. Also within reach is a so-called veterinary deal to make agricultural trade easier, while legislation is already going through parliament that would enable UK ministers to align with EU regulations in other areas to the benefit of small exporters.There may yet be a workable youth mobility scheme for those aged 18-30, which some EU members, notably Germany, regard as a test of whether this government is really different to the last one. Although the proposal was hastily ruled out during last year’s general election, the Treasury is increasingly sympathetic to it because, by some estimates, it could do more for growth than planning reform and housebuilding combined. At the same time, new cooperation on North Sea windfarms and negotiations to align the UK and EU carbon trading scheme could increase investment, improve energy security and generate billions of pounds in additional revenue.But there are still limits to this revived EU-UK relationship and it will never go far enough or fast enough to satisfy the many Labour supporters convinced that Brexit was a catastrophic mistake. Those close to Starmer emphasise he’s less interested in “relitigating old arguments from the previous decade” than in finding new ways to pursue the national interest now that “the era of globalisation is over”. Downing Street believes that part of the appeal of both Trump and our homegrown strain of rightwing populism lies in how institutions like the EU became too detached from the people they were meant to serve. In short, they’re determined not to be seen defending the status quo.The UK wants any security pact to include data-sharing on illegal immigration, which the EU, for its own arcane reasons, may be unwilling to accept. The government will insist that any defence deal must also allow British industry to bid for contracts from a massive new European rearmament fund. That agreement, in turn, could yet be held up by rows with a French government demanding concessions over fish quotas. The hope is that our political leaders prove big enough to hurdle such obstacles. But economic nationalism is not confined to the White House and making meaningful progress in Europe has never been easy.Though Arsenal’s Champions League victory will have been the high point of Starmer’s week, he may reflect that his team haven’t yet reached the semi-final stage of the competition. In politics, as in football, there is much to play for in Europe, and a long way to go.

    Tom Baldwin is the author of Keir Starmer: The Biography More

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      Look on the bright side of Trump’s global tariffs | Letters

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      Although environmental considerations will not have been a motivation for Donald Trump, it is worth examining whether a comprehensive revision of global trade tariffs – notwithstanding the significant transitional economic and human costs – could generate substantial environmental benefits (Here’s one key thing you should know about Trump’s shock to the world economy: it could work, 7 April).The prevailing model of liberalised global trade facilitates the transoceanic movement of consumer goods, often to countries that possess the capacity to manufacture equivalent products domestically. The associated carbon emissions from maritime and air transport are considerable, particularly given the volume of low-cost, frequently low-durability goods entering developed markets.Restricting free trade to essential imports – goods that cannot be manufactured or grown locally – would materially reduce transport-related emissions. Additional benefits might include enhanced food system resilience, improved biosecurity and increased regulatory autonomy over quality and safety standards.Thus, albeit unintentionally, President Trump’s trade policies could contribute to environmental objectives that are traditionally pursued by other means.Patrick CosgroveChapel Lawn, Shropshire Donald Trump’s tariffs – why the fuss? As an ordinary UK citizen I see only upsides. First, it’s the Americans paying the tariffs, not us. The resulting fall in the price of oil and the value of the dollar should reduce the cost of my petrol. As Americans switch to bourbon and Californian wine, the price of my scotch whisky and French wine should come down. If other countries send more of their goods to the UK to avoid the tariffs, this will force UK producers to become more competitive to the benefit of ordinary people like me.I believe that US citizens rich enough to buy Range Rovers and the like will not balk at paying a bit more, especially as the US equivalents are so clunky. If the steel tariff forces us to nationalise British Steel, good. As for the global economic system, this is structured for the benefit of big corporations and shareholders. Perhaps it is overdue for a change.Christopher WoodageCamberley, Surrey I have long believed that the way we choose to spend our money is a political act. With an overcautious Labour government in power, spending power remains an important act of resistance. Now more than ever, I urge readers to think carefully about what they purchase and, in particular, to boycott American goods. I have lived happily without an Amazon product for over 15 years, for instance, and with the added pleasure of knowing that my spending in local shops is benefiting the local economy. If we can’t rely on our government to stand firm, let’s do it for ourselves.Prof Mark DoelSheffield “I am telling you, these countries are calling us up, kissing my ass,” Trump said during a speech at the National Republican Congressional Committee dinner in Washington on Tuesday evening. Please let the UK not be one of the countries. Surely we have more self-respect than that.Ann ClewerCanterbury Looking at recent events, it seems Donald Trump is the most successful anti-capitalist since Lenin.Keith FlettTottenham, London More

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      The Guardian view on Starmer’s choices: time to be bold | Editorial

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      In his speech to the Labour party conference in 2005, Tony Blair used a seasonal analogy to make the case for embracing disruptive but inevitable change. “I hear people say we have to stop and debate globalisation,” Mr Blair told delegates. “You might as well debate whether autumn should follow summer.”Twenty years on, to quote the billionaire US hedge fund manager Bill Ackman, it is the threat of a self-inflicted “economic nuclear winter” that haunts the global economy. Donald Trump’s imposition of swingeing US tariffs has unleashed mayhem on stock markets across the world, upending assumptions governing the world trade order since Bretton Woods. As Darren Jones, the chief secretary to the Treasury, said at the weekend: “Globalisation as we’ve known it for the last couple of decades has come to an end.”What that means for the Labour government he serves and for Britain is both fraught with consequence and, to a significant degree, beyond Whitehall’s control. Second-guessing Mr Trump’s ultimate intentions – and the political and economic risks that he is willing to take, as consumers suffer the consequences of a trade war – is a futile exercise. But as the White House seeks to bully, intimidate and coerce its way to a new settlement between the US and the rest of the world, the risk of a global recession is clear.What Sir Keir Starmer described on Monday as a “new era” will require strategic boldness from an habitually cautious prime minister. Sir Keir should, for example, now go further and faster to reset relations with the EU, the UK’s biggest trading partner by far. That may involve an uneasy balancing act if EU countries decide to retaliate against Mr Trump, as the government seeks a trade deal with the White House and related tariff mitigation. But the alternative is unsplendid and impotent isolation, and a future “special relationship” with the US that approximates ever more closely to vassal status.Domestically, a reset is also required. Speaking in the West Midlands, Sir Keir announced modest measures to assist the UK car industry, hammered by 25% tariffs on exports at a time when it is also dealing with the pressures of the green transition. The prime minister described this as a “downpayment” on future support. But supply-side plans to relax electric vehicle targets for manufacturers send the wrong environmental message, when what is needed are radical measures to turbocharge consumer demand.The problem, paradoxically for a prime minister who defines himself as a pragmatist, is ideology. As the UK faces potentially huge economic headwinds, Labour’s industrial strategy will need to be bigger, more interventionist and less constrained by the redundant economic orthodoxies to which it continues to pay obeisance. Aspirations to drive significant growth through a combination of budgetary conservatism and deregulation were already looking doomed prior to Mr Trump’s act of sabotage last week. Following “liberation day”, Sir Keir’s ongoing insistence that the government will stubbornly persist with its fiscal rules begins to look like an act of national self-harm.Mr Blair’s old message on globalisation, addressed to post-industrial regions suffering the effects of unleashed market forces, used to be to adapt or face the consequences. As Mr Trump gambles on the fate of the world economy, making up the rules as he goes along, Labour will need to do precisely that, and at pace.

      Do you have an opinion on the issues raised in this article? If you would like to submit a response of up to 300 words by email to be considered for publication in our letters section, please click here. More

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      Labour: changes to EV rules will have ‘negligible’ impact on UK emissions

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      Labour’s changes to electric vehicle (EV) rules in response to Donald Trump’s tariffs will have a negligible impact on emissions, the transport secretary has said.Keir Starmer has confirmed plans to boost manufacturers, including reinstating the 2030 ban on the sale of new petrol and diesel cars.But regulations around manufacturing targets on electric cars and vans will also be altered, to help companies in the transition, and new hybrids will be on the market for a further five years.Heidi Alexander said the taxes on imports announced by the US president last week, which spurred reciprocal action by some affected countries, “are bad news for the global economy, because it’s bad for global demand, it’s bad for prices and it’s bad for consumers”.Speaking on BBC Breakfast about the impact on carbon emissions of the government’s changes to electric vehicle rules, she said: “The changes we are making have been very carefully calibrated so as not to have a big impact upon the carbon emissions savings that are baked into this policy. In fact, the impact on carbon emissions as a result of these changes is negligible.”Under the measures, luxury supercar companies such as Aston Martin and McLaren will be allowed to keep producing petrol cars beyond 2030 because they manufacture only a small number of vehicles a year. New hybrids and plug-in hybrid cars will be allowed to be sold until 2035. Petrol and diesel vans will be able to be sold until 2035, as well as all hybrid models.Alexander said the government had “struck the right balance” between protecting British businesses and cutting carbon emissions.Asked whether the retention of a 2030 target for the phasing out of all pure petrol and diesel cars would restrict free markets at a time when the car industry was on its knees, she said: “It is an opportunity for the car industry to remain at the cutting edge of the transition to EVs, but it’s right that we’re pragmatic.“It’s right that we are looking at how we can be flexible in the way in which car manufacturers make this transition, because we want cheaper EVs to be available for consumers. We want people to be able to benefit from those lower running costs as well.“And so it’s important that, as a government, we do everything that we can – not only to support British businesses and manufacturing to grow the economy, but also to cut those carbon emissions, and I think we’ve struck the right balance in the package that we’re announcing today.”Asked on BBC Radio 4’s Today programme if Starmer was prepared to use the relationship he has built with Trump to ask him to change course, she said: “Obviously when the prime minister has discussions internationally with allies he will be honest about what is in the best interests of the British people.”Challenged that the EV measures were planned before the announcement of the tariffs and were a tweak to policy rather than dramatic change, she told Today: “These are significant changes to the car industry. You are right to say we started the consultation on Christmas Eve and that we closed the consultation in the middle of February.”skip past newsletter promotionafter newsletter promotionShe said Trump’s imposition of tariffs meant the UK government had to look at its EV plans with “renewed urgency”.The Green party MP Siân Berry said: “The government is wrong to apply the brakes on the sale of EV cars. This is just the latest in a series of boosts the Labour government has given fossil fuel industries. We’ve also seen the green light being given to airport expansion and a new road tunnel under the Thames. This suggests Labour is weakening its climate commitments, and its health-related policy goals because all these moves will have a detrimental impact on air quality.“Slowing down the move away from fossil-fuelled transport makes no economic sense either, since green sectors of the economy are growing three times faster than the overall UK economy.”Colin Walker, the head of transport at the Energy and Climate Intelligence Unit, said: “In weakening the mandate elsewhere by extending flexibilities and allowing the sale of standard hybrids between 2030 and 2035, the government risks reducing the competition it has stimulated between manufacturers, meaning prices for families seeking an EV might not fall as fast, and sales could slow.“The growth of the secondhand EV market, where most of us buy our cars, would in turn be stunted, leaving millions of families stuck in petrol and hybrid cars paying a petrol premium of hundreds, and even thousands, of pounds a year.” More

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      Global markets in turmoil as Trump tariffs wipe $2.5tn off Wall Street

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      Global financial markets have been plunged into turmoil as Donald Trump’s escalating trade war knocked trillions of dollars off the value of the world’s biggest companies and heightened fears of a US recession.As world leaders reacted to the US president’s “liberation day” tariff policies demolishing the international trading order, about $2.5tn (£1.9tn) was wiped off Wall Street and share prices in other financial centres across the globe.Experts said Trump’s sweeping border taxes of between 10% and 50% on the US’s traditional allies and enemies alike had dramatically added to the risk of a steep global downturn and a recession in the world’s biggest economy.World leaders from Brussels to Beijing rounded on Trump. China condemned “unilateral bullying” practices and the EU said it was drawing up countermeasures.While Trump timed his Wednesday evening Rose Garden address to avoid live tickers of crashing stock markets, that fate arrived when Asian exchanges opened hours later.Drawing comparisons with the market crashes at the height of the coronavirus pandemic and the 2008 financial collapse, the sell-off swept the globe, sending exchanges plunging in Asia and Europe. The UK’s FTSE 100 index of blue-chip companies closed the day down 133 points, or 1.5%, to 8,474 after suffering its worst day since August.All three main US stock markets were down at the end of trading in their worst day since June 2020, during the Covid pandemic. The tech-heavy Nasdaq fell 5.97%, while the S&P 500 and the Dow dropped 4.8% and 3.9%, respectively. Apple and Nvidia, two of the US’s largest companies by market value, lost a combined $470bn in value by midday.Libby Cantrill, the head of US public policy at Pimco, one of the world’s largest bond fund managers, said investors were growing increasingly concerned as Trump appeared to be unwilling to soften his stance in the face of market turmoil, although hope remained that he would ultimately strike deals with US trading partners.“There is likely a limit to how much pain he and his administration are willing to endure in order to rebalance the economy, but when that is or what that looks like remains to be seen,” she said.“For now, we should assume that his pain tolerance is pretty high and that tariffs stick around for a while.”The US dollar hit a six-month low, falling 2.2% on Thursday morning, amid a growing loss of confidence in a currency previously considered the safest in the world for most of the past century.Warning clients to beware a “dollar confidence crisis”, George Saravelos, the head of foreign exchange research at Deutsche Bank, said: “The safe-haven properties of the dollar are being eroded.”The heaviest falls in share prices on Thursday were reserved for US companies with complex international supply chains stretching into the countries that Trump is targeting with billions of dollars in fresh border taxes.Apple, which makes most of its iPhones, tablets and other devices for the US market in China, was down 9.5% at close of trading, and there were steep declines for other large multinationals including Microsoft, Nvidia, Dell and HP.Commodities fell sharply, including a 7% plunge in oil prices, reflecting growing concerns over the global economic outlook.Speaking to reporters on Thursday, Trump said: “I think it’s going very well. It was an operation like when a patient gets operated on and it’s a big thing. I said this would be exactly the way it is … We’ve never seen anything like it. The markets are going to boom. The stock is going to boom. The country is going to boom.”Trump later said: “Every country is calling us. That’s the beauty of what we do. If we would have asked these countries to do us a favour they would have said no. Now they will do anything for us.”skip past newsletter promotionafter newsletter promotionOver the last nearly 24 hours, Trump has faced widespread backlash from US lawmakers and global leaders over his tariffs plan, with the senior Republican senator Mitch McConnell calling it “bad policy” while Canada – a traditional American ally – called the tariffs “unjustified” and “unwanted”.Tariffs will fall heavily on some of the world’s poorest countries, with nations in south-east Asia, including Myanmar, among the most affected.Cambodia, where about one in five of the population live below the poverty line, was the worst-hit country in the region with a tariff rate of 49%. Vietnam faces 46% tariffs and Myanmar, reeling from a devastating earthquake and years of civil war after a 2021 military coup, was hit with 44%.Analysts warned that garment and sports shoe makers, which rely heavily on production in south-east Asia, face rising costs, which will push up prices for consumers around the globe. The share prices of Nike, Adidas and Puma all fell steeply.Analysts said Trump’s measures would raise the average tariff, or border tax, charged by the US to the highest level since 1933, in a development that threatened to sink the US into recession while increasing living costs for consumers.Trump’s plans involve imposing a 10% tariff on all US trading partners from just after midnight on 5 April, before additional higher tariffs of up to 50% are imposed on countries including China, Vietnam and the EU.The non-partisan Tax Foundation thinktank said it estimated the plan would represent a “$1.8tn tax hike” for US consumers, which would cause imports to fall by more than a quarter, or $900bn, in 2025.While the measures will hit the US hard, researchers at the consultancy Oxford Economics said they could sink global economic growth to the lowest annual rate since the 2008 financial crisis, barring the height of the Covid pandemic.Countries scrambled to assess the fallout and whether to retaliate. The UK, which was hit with the lowest level of 10% tariffs, suggested it may retaliate even as it tries to strike a deal with Washington.It published a 417-page list of US products on which it could impose tariffs, including meat, fish and dairy products, whiskey and rum, clothing, motorcycles and musical instruments.The business secretary, Jonathan Reynolds, told MPs that ministers were still pursuing an economic deal with the US as the priority but “we do reserve the right to take any action we deem necessary if a deal is not secured”.The French president, Emmanuel Macron, said Trump’s decision to impose tariffs of 20% on EU goods was “brutal and unfounded”, while Germany’s outgoing chancellor, Olaf Scholz, called it “fundamentally wrong”.Spain’s prime minister, Pedro Sánchez, said the “protectionist” tariffs ran “contrary to the interests of millions of citizens on this side of the Atlantic and in the US”.The EU is thought to be preparing retaliatory tariffs on US consumer and industrial goods – likely to include emblematic products such as orange juice, blue jeans and Harley-Davidson motorbikes – to be announced in mid-April, in response to steel and aluminium tariffs previously announced by Trump. 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      UK won’t engage in ‘kneejerk’ response to Trump tariffs, says minister

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      The UK government will not engage in a “kneejerk” response to any tariffs imposed by Donald Trump, as it warned there would be a “difficult period” ahead in trade relations with the US and called for calm.The US president is to announce his latest round of tariffs on Wednesday – which he has called “liberation day” – sparking concerns over a global trade war.The prime minister, Keir Starmer, and the chancellor, Rachel Reeves, will face questions from MPs in parliament before the anticipated new tariffs that could derail their economic plans.Speaking before the announcement, Bridget Phillipson, the education secretary, said the government had been “working through every eventuality”.“We do recognise this is likely to be a very challenging period,” she told BBC Breakfast. “We still have negotiations under way with our US counterparts about securing an economic deal, but we will always act in the national interest and the interest of the British people.”Phillipson said the government would “always act in the national interest and the interest of the British people”, adding: “I think what they want, and what business and industry wants, is to for us to maintain a calm and quite pragmatic approach during this time and not engage in a kneejerk response, because the last thing that anybody would want is a trade war with the US.”Since taking office, Trump has rattled global stock markets and caused consternation among business leaders by announcing and then delaying plans to impose tariffs on foreign imports.The threats have soured US relations with its largest trading partners. Canada’s prime minister, Mark Carney, has called them “unjustified” and said his country would react robustly. The European Union has said it has a “strong plan” to retaliate.Asked whether the UK government would consider abandoning its fiscal rules in the event of exceptional trade circumstances, Phillipson said “fiscal rules do matter”.“They matter because we have to demonstrate that we have a clear sense about how we manage the public finances,” she told Sky News.“I think your viewers will have seen in recent years with the Liz Truss government, what happens when you have a government that doesn’t have a grip on the public finances and isn’t prepared to make choices about priorities. Our fiscal rules are important, and they do matter.”Speaking about the government’s announcement of up to 4,000 new childcare places in new or expanded school-based nurseries, Phillipson said it was the “first step” towards achieving the 100,000 places promised by Labour last year.“We know the difference that early years education makes to children’s life chances, and also your viewers will know how important it is that they can access childcare places,” she said. More

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      Trump’s ‘liberation day’ tariffs: what’s at stake for UK and EU?

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      The EU and the UK are bracing for a damaging trade war with the US, as Donald Trump is expected to implement his threat to impose tariffs on imports from Europe.For weeks, he has named 2 April “liberation day”, with the unveiling of a tariff plan to reverse what he called “unfair practices that have been ripping off our country for decades”.What tariffs are expected?A 20% blanket tariff on nearly all imports to the US has been drafted by Trump’s aides.However, EU and UK leaders are concerned about the possibility of sectoral tariffs, as well as permanent levies he may impose to counter Europe’s VAT rates, which he considers a de facto tax.Trump, who once challenged the then German chancellor Angela Merkel for not ensuring there were more Chevrolets in Munich, has already announced tariffs on cars starting on 3 April.Will the UK be spared?The relative warmth Trump showed Keir Starmer in the Oval Office last month is unlikely to protect the UK, with tariffs expected on “all countries”. However, the UK has been racing to agree a deal, with the business secretary, Jonathan Reynolds, suggesting that if any country can secure a carve-out, Britain could.On Tuesday, Starmer said businesses did not want a tit-for-tat war. Instead of a “kneejerk” reaction, he would respond in a “calm and collected” manner.He hoped a trade deal, something that eluded a succession of UK governments over decades, would “mitigate” the impact of tariffs. The UK was this time seeking a much narrower “economic prosperity deal” rather than a more comprehensive “free trade agreement”.Although this would be far less expansive in scope, the hope is that it should be quicker to agree.Does Trump really hate Europe?European leaders were alarmed by the attacks on Europe by the vice-president, JD Vance, but Trump has been notably less visceral, confining his interests to defence and the trade imbalance.He has complained that the US was “ripped off by every country in the world” and that he was “not happy with the EU” as a place to do business. His exclusion of the EU in talks over Ukraine has ruptured the higher-level geopolitical transatlantic relationship.How will the EU react?Strongly. The EU has already announced a string of tariffs it plans to introduce on US imports targeting steel and aluminium in kind, as well as textiles, leather goods, home appliances, house tools, plastics and wood.Sources say it is also considering nuclear options, including tariffs on revenues generated in the EU by big tech firms and social media.This could be seen as highly provocative and would put Trump’s allies, such as Elon Musk and Jeff Bezos, in the crosshairs. It would also test the unity of the EU, with Ireland expected to argue against more punitive measures because of the dominance of the US tech sector in Dublin.The EU’s preference is to negotiate so it has decided to delay countermeasures to open a space for talks. Maroš Šefčovič, the European commissioner for trade and economic security, has already met the US commerce secretary, Howard Lutnick, and, although Šefčovič reportedly came home last week “empty handed”, he is operating the Brexit playbook, hoping to build a personal relationship that will provide credit in the bank when they get down to talks.Why not enter immediate negotiations?One EU official said there was no point negotiating with the US at this stage, saying it would be like arguing over rotten fish.“It is not very productive to now start negotiating about removing the tariffs,” the official said. “You put a stinking fish on the table, and then you start negotiating to remove that stinking fish, and then you say: ‘Wow, we have a great result: there’s no stinking fish on the table.’ That is not a very productive conversation.”Trade experts also say negotiations with the US would involve agreeing a strategy between 27 different member states, which could be tricky given the potential for splits between countries, as EU states negotiate trade deals as a unified bloc.What is Trump’s game plan?Trump has been obsessed with tariffs since the 1980s, when he railed against the Japanese buying up real restate in the US, an open economy, but with US investors unable to reciprocate in Tokyo.His goal is to reindustrialise the US and to repatriate jobs and taxes he thinks US companies should be paying at home rather than abroad. While currently at a 21% corporate tax rate, the US for a long time operated at a 35% corporate tax rate, pushing some of its biggest companies to push for lower taxes.To revive local industry, Trump wants to shorten the supply chain and make sure more components are manufactured locally.What does the data on trade show?The US is the largest importer of goods in the world, buying $3tn-worth of products in 2023. Its largest trade deficit is with China, from where it imports $279bn more than it exports, followed by the EU at $208bn.EU-US trade is worth €1.6tn but only three countries – Ireland, Germany and Italy – enjoy a surplus in goods trade.Germany’s trade surplus in goods was €57bn in 2023, according to official US data. In 2023, Germany sold €144bn-worth of goods to the US, of which €22bn was on cars. By contrast, the US sold €87bn-worth of goods to Germany, including €8.25bn-worth of cars.Ireland has the second-largest trade imbalance, a surplus of €50bn largely caused by the export of pharmaceuticals to the US from large US multinationals. But it has been consistently singled out by Trump and is seen as highly exposed.Italyhas a trade surplus of €41bn, selling about €65bn-worth of goods to the US. Packaged medicines and cars account for about €5bn and €4.66bn of all exports respectively.The UK has a more balanced relationship with the US. The US is Britain’s largest single-export market, worth £60.4bn in goods in 2023, accounting for 15.3% of the global total. The UK imported £57.9bn in goods from the US.How is business reacting?The US markets are spooked, with S&P 500 and Nasdaq closing March trade with their worst quarter performance since Russia’s invasion of Ukraine in 2022.The EU is presenting itself as a safe haven. “I do think investors at the moment are re-evaluating the EU and investing in the European Union. I think there’s a growing appreciation of the value of predictability and order on the global stage,” said Paschal Donohoe, Ireland’s finance minister.So far this year, the pan-European Stoxx 600 index has gained 6.4%, while the US S&P 500 index has lost 5% and had its worst quarter since 2022. More

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      Wednesday briefing: What the latest wave of tariffs mean for the US, UK, Europe – and you

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      Good morning. According to Donald Trump, it’s “liberation day”: the advent of a new trade order in which Americans reap the benefit of massive tariffs on imports, and the rest of the world picks up the tab.Unsurprisingly, the United States’ trading partners tend to take a very different view. And they are doing everything they can to avoid being passive targets for the White House’s carnivorous vision of American exceptionalism.Trump will announce his plans at 4pm Eastern Time (9pm UK) in the White House’s Rose Garden – but it is still not clear whether a flat rate will be applied globally, or if the charge will vary by country instead. Even at the last minute, countries including the UK are hoping that they might win exceptions; political leaders, and financial markets, are on edge.For today’s newsletter, Guardian correspondents explain what the tariffs mean around the world – and when you can expect to feel the impact in your pocket. Here are the headlines.Five big stories

      Israel-Gaza war | Israeli Defence Minister Israel Katz announced a major expansion of the military operation in Gaza on Wednesday, saying large areas of the enclave would be seized and added to the security zones of Israel. Follow the latest here.

      Israel-Gaza war | Some of the bodies of 15 Palestinian paramedics and rescue workers, killed by Israeli forces and buried in a mass grave in Gaza, were found with their hands or legs tied and had gunshot wounds to the head and chest, according to two eyewitnesses. The accounts add to evidence pointing to a potentially serious war crime on 23 March.

      UK news | More than 20 women have contacted police to say they fear they may have been attacked by the serial rapist Zhenhao Zou, with detectives fearing there may be even more victims to come. Zou, 28, was convicted last month of raping three women in London and seven in China between 2019 and 2024.

      US politics | Cory Booker, the Democratic US senator from New Jersey, has broken the record for longest speech ever by a lone senator by spending 25 hours and five minutes inveighing against Donald Trump in the chamber. Booker’s speech was intended to highlight the “grave and urgent” danger that Trump poses to democracy.

      Cinema | Val Kilmer, the actor best known for his roles in Top Gun, Batman Forever and The Doors, has died at the age of 65. His daughter Mercedes told the New York Times that the cause of death was pneumonia.
      In depth: Concessions, retaliation, ‘friendshoring’ – and a new mood of volatilityView image in fullscreenOn Monday, Donald Trump told reporters that he had “settled” on a tariff plan – but according to CNN, White House officials were still presenting him with options on Tuesday. And White House press secretary Karoline Leavitt told reporters that he was “always up” for a phone call or negotiation with foreign leaders hoping to plead their case.That suggests the satisfaction Trump takes in the power he is able to exert through the United States’ economic might. And whereas in his first term he appeared sensitive to the markets giving his economic policies the thumbs down, he seems genuinely more bullish this time around. Even on the question of whether consumers will pay more, he has so far stuck to the line that the cost will be worth it in the end.“I couldn’t care less if they raise prices, because people are going to start buying American-made cars,” he said of tariffs on foreign cars on Sunday. And last month, of the tariffs on Canada and Mexico, he said: “We may have, short term, a little pain. People understand that.”Here’s what that stance means around the world.UK | What is Downing Street’s strategy?View image in fullscreenLast night, Pippa Crerar, Heather Stewart and Richard Partington reported that the UK is ready to offer a significant reduction in its digital services tax, a 2% levy on UK revenues that applies to big American tech firms including Amazon, Meta, Alphabet, eBay, and Apple.But while business secretary Jonathan Reynolds has insisted that the UK is in “the best possible position of any country to reach an agreement”, Downing Street acknowledges that it is unlikely to get a deal before tariffs come in on a global scale.“They’ve been aiming at an exemption ever since Trump was inaugurated,” Pippa, the Guardian’s political editor, said – one key reason that Peter Mandelson, a trade expert, was appointed as US ambassador. “Trump has talked about ‘being nice’ to countries that ‘haven’t made a fortune’ out of the US – they hope that’s aimed at us.”“They remain hopeful he’ll row back quickly because they say a trade deal is ready to go,” she added. “Despite what they say, the trade deal is as much or more about avoiding tariffs as having a brilliant economic relationship. So it’s a defensive move.”As well as the digital services tax, Trump appears to view VAT as unfair. “I just don’t see how they could change that,” Pippa said. “It’s paid by all companies, not just US ones. And there’s some anger within Labour that the US is trying to interfere with domestic taxation systems.”That speaks to some of the risks of caving to Trump’s demands. “They’re always thinking of the politics of it,” Pippa said. “But they believe that it’s worth a few bad headlines back home about sucking up to Trump to avoid the potential damage of a full blown trade war with the US which could cost our economy billions.”Markets | What kind of impact are we seeing?“We’ve had plenty of volatility already this year, partly because many analysts were complacent about how disruptive Trump would be,” said Graeme Wearden, who runs the Guardian’s daily business liveblog.“Several Wall Street firms have already cut their end-of-year forecasts for the US stock market in recent weeks, which shows that some of the recent drama is being priced in. But, having seen the US president announce tariffs against Mexico and Canada, and then delay them, investors probably won’t assume the Rose Garden announcement will be the end of the story.”MCSI’s index of global stocks showed a 4.5% fall in March, the biggest decline since September 2022. But that impact has not been evenly distributed. “There’s been a clear rotation out of US stocks this year, and into Europe,” Graeme said. “While the S&P 500 index of US shares is down 4.5% during 2025, the pan-European Stoxx 600 has jumped 6%.” The FTSE 100 has enjoyed its best quarter since 2022 as traders have looked for alternatives to US firms.If you’re looking for other signs that this is a nervous moment, the Cboe Volatility Index (Wall Street’s “fear gauge”), has climbed by a third in the last week – and is up 50% on a year ago. That is “a sign that investors expect volatile times”, Graeme said. But he added: “It was three times higher during the 2008 financial crisis, showing that a) investors aren’t in a full-blown panic, and b) there’s room for more volatility.”World | How are other countries responding?The UK is not the only country to seek carve-outs from Trump’s threatened universal tariffs: Japan, for example, has tried to persuade the US its manufacturers should be exempted from the 25% car tariff, and South Korea has sought an exemption from steel and aluminium exports.But the wider pattern is of major economic counterparts seeking to respond in kind. “Certainly the EU is expected to retaliate, and we’ve already seen Canada, for instance, hit back,” said economics editor Heather Stewart. “They’re most likely to try and pick up on specific products that hit the US without screwing up their own supply chains too much … Retaliation will tend to make the economic impact of tariffs worse; but politically, it’s understandable that countries want to look tough.”The other major plank of the global response has been an acceleration in moves towards “friendshoring” – the strategy of reorienting trade policies towards trusted allies with a more reliable approach. China, Japan and South Korea are holding talks over a new free trade deal, for example.“It was already happening to some extent,” Heather said, partly because of “renewed awareness of extended supply chains that came with Covid and Russia’s invasion of Ukraine. But I would definitely expect more deals that exclude the US.”Cost of living | When am I going to start feeling the impact?It’s still too early for the specific costs attached to tariffs to be felt in a major way by consumers – but “the price impact could already be beginning”, economics correspondent Richard Partington said. “Some economists reckon firms will raise their prices under the cover of tariffs, with the assumption that consumers think prices will rise – even if tariffs on those goods are never actually introduced.”skip past newsletter promotionafter newsletter promotionWhile that is hard to quantify, there is evidence from the US during Trump’s first term – when the cost of clothes dryers went up because of a tariff on imported washing machines – that it is a plausible path. Something similar might happen in the UK on goods sold from the US using components sourced from overseas, Richard said – but it’s also possible that “trade reallocation”, where countries send exports that might have gone to the US to other trading partners, could lead to price cuts.Consumers will be affected in other ways that are less direct – but no less real. There has been a marked impact on consumer confidence surveys, Richard said, and businesses are holding back on their spending plans. “The potential UK impact has been best spelled out so far by the OBR,” Richard said. “In the worst case scenario of global trade disputes escalating 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%.”That would wipe out all of Rachel Reeves’ storied fiscal headroom by the fifth year of forecasts, making tax rises in the autumn inevitable. Uncertainty is another intangible but consequential factor, he added – “like a slow puncture on the global and UK economy”. You can keep juddering on – but it’s anybody’s guess when you’ll suddenly veer off the road.What else we’ve been readingView image in fullscreen

      The daily deluge of news has made many people turn off their televisions, unsubscribe from papers and avoid news websites. This phenomenon of news avoidance is growing across the board. Michael Savage takes a look at how newsrooms are responding. Nimo

      Oliver Wainwright’s writing on architecture is always compulsively enjoyable, and his review of a new student complex in Oxford meets those expectations. With “rhubarb and custard-coloured stonework” and a “bulbous roof of polygonal scales”, the overall effect is a “hallucinatory sense that you might have been swallowed into the belly of a cuddly toy”. Archie

      Reviewing culture has had an outsized influence on my decision-making: less than a 4.5 out of 5 rating and I likely won’t go to a restaurant or buy a product. But how helpful is it really? Chloë Hamilton asks what this level of “mutual surveillance” is doing to our lives. Nimo

      On the one hand, Daniel Lavelle has two degrees and two books to his name; on the other, he left education at 14 and started working life in a cotton mill. So where does he fit into Britain’s suffocating class system? His attempt to make sense of it all has the vital quality of thinking out loud, but no straightforward answers. Archie

      I recently started Benjamín Labatut’s novel The Maniac and I have never felt so engrossed in a book that focusses so closely on mathematics and physics. In this disquieting book that spans a century, Labatut examines the dark foundations of our modern world and the extraordinary and troubled minds behind it. Nimo
      SportView image in fullscreenFootball | Bukayo Saka scored the decisive goal in Arenal’s 2-1 win against Fulham seven minutes after coming off the bench on his return from injury. In the night’s other Premier League matches, Nottingham Forest beat Manchester United 1-0 and Wolves beat West Ham 1-0.Cricket | Charlotte Edwards has been named as the new England women’s head coach. The former England captain put her hat in the ring in February, when changes were expected after a disastrous tour of Australia last winter in which England lost the Ashes by 16 points to nil.Rugby | There remains a “high degree of uncertainty” over whether tens of millions of pounds paid to rugby union clubs and other sports teams during the Covid-19 pandemic will ever be repaid, a House of Commons committee has warned. The committee said that the Department for Culture, Media and Sport has been “overly optimistic” about loans worth £474m.The front pagesView image in fullscreen“PM offers US tech firms tax cut in return for lower Trump tariffs” says the Guardian’s splash headline, while the Telegraph’s version is “Starmer’s 11th-hour bid to halt trade war”. It’s “Trump trade madness” and “CARnage” on the front of the Mirror while the Times has “Firms told to brace for impact of Trump tariffs”. The Daily Mail finds reason to be cheerful: “Trump’s tariffs threaten crisis for Reeves” and the Express runs with “Don’t provoke new trade war that ‘makes UK poorer’,” saying Kemi Badenoch doesn’t want Starmer to retaliate. In the i they’ve gone with “UK told to ‘prepare for the worst’ as Trump begins his global trade war”. In times like these, trust the Financial Times with your money: “Investors flock to gold as fears mount on eve of Trump tariff announcement”. “Student rapist: 23 more victims” is the top story in the Metro.Today in FocusView image in fullscreenCould Marine Le Pen’s guilty verdict help fuel the far right?The parliamentary leader of France’s far-right National Rally party, Marine Le Pen, has been banned from public office for five years for embezzlement, ruining her chance of a presidential run. Angelique Chrisafis reportsCartoon of the day | Pete SongiView image in fullscreenThe UpsideA bit of good news to remind you that the world’s not all badView image in fullscreenJoy Ebaide, a Nigerian solo traveller, has embarked on many journeys across Africa, which all came with their own challenges. A heart-stopping encounter with a black mamba while riding her motorbike in Tanzania was terrifying, but it did not put her off travelling. Instead, it fuelled her desire to keep exploring. Ebaide embarked on a five-month solo journey from Mombasa to Lagos in 2024, riding a Tekken 250cc motorbike across Africa’s rugged terrains. Her travels, shared on social media, not only highlight the fun experiences but also shed light on the challenges faced by those with “weaker” passports.Ebaide is not alone in her pursuit of adventure despite these obstacles. Alma Asinobi, after facing visa refusals, set out to break a world record for visiting all seven continents. “The trip itself is a victory. Because historically, travelling as a black woman has an additional layer of complexity … I just want more women to know that you can do things, and it’s OK whether it works or not: just do things,” she says.Bored at work?And finally, the Guardian’s puzzles are here to keep you entertained throughout the day. Until tomorrow.

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      Ministers brace for more Trump tariffs as UK races to agree US trade deal

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      Ministers believe Britain will be hit by more tariffs when Donald Trump unveils his latest round of trade barriers on Wednesday as part of what the US president is calling “liberation day”.On Sunday night, Keir Starmer spoke with Trump in what Downing Street described as part of “productive negotiations” towards a deal. A No 10 spokesperson said both men had agreed talks between the two sides would “continue at pace this week”, adding: “They agreed to stay in touch in the coming days.”Senior members of the government have been engaged in intense negotiations over recent weeks as they race to agree a trade deal with the US, which could avoid the UK being included in the package of measures.The stakes are high for the British government – forecasters have said a 20 percentage point increase on tariffs on UK goods and services would cut the size of the British economy by 1% and force the chancellor, Rachel Reeves, into tax rises this autumn.Officials now fear, however, they will not have agreed the deal in time, sources have told the Guardian, and are resigned to being hit by whatever Trump announces on 2 April.But ministers will continue negotiating after that date, hoping they can avoid a damaging hit to UK economic growth by agreeing a deal to reduce tariffs once they have already been promised.One Whitehall official told the Guardian: “We have been working hard behind the scenes for a while on an economic deal, and that work continues. But we don’t see Wednesday as a hard and fast deadline.”Another said: “If we don’t get a deal by Wednesday it won’t be the end of the world. The main thing is to make sure we get enough from the US to make a deal worth signing.”Trump has said he will unveil what he says are “reciprocal” tariffs on trading partners around the world on Wednesday. Last week, the US president announced he would introduce a 25% tariff on car imports to the US on 2 April, which would hit British carmakers such as Bentley and Aston Martin.But just days ahead of the larger announcement, even White House officials say they have little sense of which tariffs the president intends to levy, on which countries and by how much.British negotiators, led by the business secretary, Jonathan Reynolds, have been talking to their US counterparts for weeks to agree a technology-focused trade deal, which they hope would also exempt the UK from the heaviest of Trump’s tariffs. Downing Street officials are closely involved in the talks, including the prime minister’s head of international economic affairs, Michael Ellam, and his business adviser Varun Chandra.In an indication of how far the British government is willing to go to sign the deal, ministers have offered to drop the UK digital services tax (DST). The DST is a levy on the revenues of the world’s largest technology companies – almost all of which are US-based – which is forecast to raise £1.1bn by the end of the decade.British officials are increasingly gloomy, however, about the prospect of getting the deal done in the next three days, albeit while still hoping it could come together at the last minute.skip past newsletter promotionafter newsletter promotion“This is an unpredictable situation and an unpredictable administration,” said one. “We’re having to plan for every scenario.”If the Trump administration does include the UK in its announcement on Wednesday, Britain is unlikely to reciprocate with its own tariffs, according to people familiar with the government’s thinking. Doing so would imperil the chances of signing a deal in the future, they added.One said: “Everything is on the table. But unlike other trading partners such as the EU, our approach will be to keep a cool head and keep talking. We know British industry does not want a trade war.”However, this approach has come in for criticism in recent days. Kim Darroch, the former British ambassador to the US, told the Observer on Sunday: “[UK ministers] need to be wary of giving Trump wins; tariffs are his all-purpose forcing mechanism and he’ll use them again and again if he sees them working.”Others believe ministers have little choice but to keep negotiating. Crawford Faulkner, who stepped down in January as the UK’s lead trade negotiator, said on Sunday Britain should be “prepared to negotiate” on the DST and other issues.He told Times Radio: “There is no reason why the United Kingdom could not, across the board, have liberalisation in goods, and as much of services as is feasible, with the United States.” More