British exports to US suffer record hit from Trump tariffs

Free Malaysia Today

21 hours ago

The US imposed 25% tariffs on British steel and aluminium and increased tariffs on imports of cars to 27.5%, all alongside a blanket tariff of 10%. (Reuters pic) LONDON : British goods exports to the US suffered a record fall in April after US President Donald Trump imposed new tariffs, official figures showed today, pushing Britain's goods trade deficit to its widest in more than three years.
Britain exported £4.1 billion of goods to the US in April, down from £6.1 billion in March, Britain's office for national statistics said, the lowest amount since February 2022 and the sharpest decline since monthly records began in 1997.
The £2 billion fall – a 33% drop in percentage terms – contributed to a bigger-than-expected drop in British gross domestic product in April.
Last week Germany said its exports to the US fell by 10.5% in April, although that figure, unlike Britain's, is seasonally adjusted.
The British Chambers of Commerce said the scale of the fall partly reflected manufacturers shipping extra goods in March to avoid an expected increase in tariffs. Even so, April's goods exports were 15% lower than a year earlier.
'The economic effects of the U.S. tariffs are now a reality. Thousands of UK exporters are dealing with lower orders and higher supply chain and customer costs,' the BCC's head of trade policy, William Bain, said.
The US is Britain's largest single goods export destination and is especially important for car makers, although total British exports to countries in the EU are higher.
Britain exported £59.3 billion of goods to the US last year and imported £57.1 billion.
The US imposed 25% tariffs on British steel and aluminium on March 12 and in early April increased tariffs on imports of cars to 27.5% as well as a blanket tariff of 10% on other goods.
Last month Britain agreed the outline of a deal to remove the extra tariffs on steel, aluminium and cars – the only country to do so – but it has yet to be implemented and the 10% tariff remains in place for other goods.
Before the deal, the Bank of England estimated the impact of the tariffs on Britain would be relatively modest, reducing economic output by 0.3% in three years' time.
Bigger trade deficit
Thursday's data also showed that the fall in exports to the US pushed Britain's global goods trade deficit to £23.2 billion in April from £19.9 billion in March, its widest since January 2022 and nearly £3 billion more than had been expected by economists polled by Reuters.
Excluding trade in precious metals, which the ONS says adds volatility to the data, the goods trade deficit was the widest since May 2023 at £21.6 billion.
Britain's total trade deficit narrowed to £5.4 billion in April – also the widest since May 2023 – once the country's surplus in services exports is taken into account.