Starmer’s strategy is back to front - the trade deal we need isn’t with the US

4 April 2025, 07:40

In Donald Trump’s mad world, up is down, black is white, and war is peace.

It is only in this distorted reality that the UK government’s strategy to walk a tightrope between the United States and Europe is being entertained. Our most important defence ally is the United States, our largest trading partner is the European Union.

Yet somehow, we are chasing better trade terms with America while seeking stronger military ties with Europe. This approach is not only back to front, but risks working well for Washington and Brussels, while leaving Britain adrift, at the mercy of decisions made elsewhere.

The consequences of this strategic misstep are evident. Days before Trump’s rambling Rose Garden speech, Downing Street had already conceded defeat in its attempt to secure a trade exemption for the UK. The so-called “special relationship” has once again proven to be little more than a comforting illusion, with Britain getting the same 10% tariff treatment as Uruguay and Kenya, alongside a massive 25% levy on UK automotive exports.

Our strongest military ally has launched an unprovoked trade war against us - one that will squeeze household budgets, starve public services of much-needed cash, and cost jobs across the country. Independent analysis by Frontier Economics, commissioned by Best for Britain, shows that Trump’s tariffs will deal a 0.7% blow to the UK economy, wiping out seven times the growth the government secured last quarter, with Red Wall areas like the Midlands hit hardest.

The same economic analysis shows that by prioritising a common sense deal with the EU on trade rather than the US, we would offset the impact of Trump’s tariffs and see an economic boost of 1.5% with benefits spread nationwide, particularly in the north.

For the EU, such a deal would mitigate a third of the damage from US tariffs in a win-win scenario for this side of the Atlantic. Best for Britain’s latest polling also shows this approach is three times more popular with UK voters than cosying up to Trump.

Yet when Keir Starmer sits around a table with EU leaders next month, trade may barely make it on to the menu if he continues to prioritise a US-UK trade deal. European leaders will never agree to removing trade barriers with Britain if it risks further divergence from their high regulatory standards. Instead, they will simply push for their top priority: increased defense cooperation to counter Putin’s aggression.

For Starmer, the way forward should be obvious. He must negotiate beneficial alignment with the EU on goods to neutralise the worst effects of US protectionism and extend this alignment to services, where the UK remains a global leader. Without this shift, Britain will remain vulnerable to economic decisions made elsewhere, rather than charting its own course.

This is not about re-litigating arguments of old. It is about accepting the importance of three things: the reality of Trump’s antipathy to the UK; geography to trade; and aligning with allies we can rely on. Our businesses depend on European supply chains, our financial services require European market access, and our manufacturing thrives on regulatory consistency.

We don’t need to choose, but we urgently need to prioritise and both the economics and public opinion point in one direction - towards 1.5% GDP growth with Europe. Neither the UK economy nor the government’s poll numbers can withstand further decline. Without changing course fast, Starmer’s current approach leaves both exposed.

________________

Naomi Smith is CEO of Best for Britain.

LBC Opinion provides a platform for diverse opinions on current affairs and matters of public interest.

The views expressed are those of the authors and do not necessarily reflect the official LBC position.

To contact us email views@lbc.co.uk