90-day tariff pause means the UK will not need to choose between China and the US
The 90-day tariff pause between the US and China means the UK will not need to ‘pick a side’ in their trade war and can improve economic relations with both countries, say leading audit, tax and business advisory firm, Blick Rothenberg.
Winnie Cao, head of China desk at the firm, said: “The 90-day pause in the tariff war between China and America is welcome news for the UK, who are trying to avoid ‘picking a side’ as they wish to develop their trading relationship with both countries.”
She added: “The bitter US China trade war threatened to force the UK to choose between the two countries, as making a deal with one risked shutting them out of trade talks with the other. But the 90-day pause, intended to allow China and the US to negotiate, is a significant de-escalation, meaning the UK will no longer need to ‘pick a side.’”
Winnie said: “Earlier in the year the Chancellor, Rachel Reeves, went to China and met Vice-Premier He Lifeng, securing agreements worth £600m for the UK economy. And this month, the long-awaited US UK trade agreement was signed.”
She added: “While the US cannot veto any Chinese investment made into the UK as part of this agreement, it is clear that US President, Donald Trump and his advisors do not approve of a closer China UK relationship. It remains to be seen how the US will position itself to contain the level of Chinese outbound investment in the UK.”
Winnie said: “The US is the largest economy in the world and China the second largest. China is a leading exporter of goods such as machinery, electronics and electric vehicles, all which are very valuable to the UK which seeks to invest in green energy and AI. The US and UK trade services with each other and have a long standing ‘special relationship.’ Both countries can also offer the UK vital investment in projects and businesses.”
She added: “Some Chinese businesses are currently seeking a third country to complete the final stage of their production line before exporting to the US to avoid tariffs. But if the China US tariff war ends, they can directly export to the US again, saving them the additional costs which come with adding an extra leg to their trade journey.”
Winnie said: “The build-up of tariff wars helps no country, hopefully that is now being recognised and the UK can continue to build its trading relations with both China and the US without being caught between them.”