In a move that could have far-reaching consequences, US President Donald Trump has threatened to impose a 10% tariff on UK exports, a decision that experts warn could potentially tip the British economy into recession. This latest trade salvo is part of Trump’s ongoing efforts to pressure Denmark into selling Greenland, a semi-autonomous Danish territory.
The proposed tariffs, which could rise to 25% if a deal is not reached, would apply to a wide range of UK goods, including cars, medicines, pharmaceutical products, and machinery. According to the Office for National Statistics, the US was the UK’s largest trading partner in the 12 months leading up to July 2025, accounting for 17.8% of the country’s total trade.
Prime Minister Sir Keir Starmer has condemned the move, stating that “Applying tariffs on allies for pursuing the collective security of NATO allies is completely wrong.” The government has vowed to address the issue directly with the Trump administration, as the UK and its European allies stand in solidarity with Denmark.
William Bain, the head of trade policy at the British Chambers of Commerce, warned that the new tariffs would be “more bad news for UK exporters, already struggling with the tariffs levied last year.” He emphasised the importance of reducing, not raising, tariffs to boost the economy and the success of transatlantic trade.
Marco Forgione, the director-general of the Institute of Export and International Trade, went even further, stating that the impact for the UK could be “huge” and could even “tip the UK into recession.” He explained that British goods trading with the US would suddenly become uncompetitive in the marketplace, posing a significant challenge for the country’s economy.
This latest development in the ongoing trade war between the US and its allies comes at a time when the UK is already grappling with the economic fallout from the COVID-19 pandemic. The potential imposition of these tariffs could further exacerbate the country’s economic woes, underscoring the need for a swift and diplomatic resolution to the dispute.
