UK companies seek deeper ties with Europe as Trump tariffs fuel uncertainty, business groups say
The MSC Emma container ship on the dockside at the Port of Felixstowe in Felixstowe, UK, on Thursday, Nov. 20, 2025.
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British companies are seeking deeper trade ties with Europe, business groups told CNBC, as U.S. President Donald Trump unveiled a sweeping 15% tariff on all imports after the Supreme Court struck down previous levies.
New tariffs would mark a 50% increase on the level negotiated last year in a trade deal between the U.K. the U.S., making the country one of the worst hit, according to analysis from think tank Global Trade Alert.
While U.S. Trade Representative Jamieson Greer said the administration “expects” to stand by trade deals, the U.K. government is reportedly in ongoing discussions with counterparts in America.
The seesawing uncertainty is increasingly forcing U.K. businesses to look to closer alignment with the European Union and European countries, as they hunt for predictable trade partnerships, groups which represent U.K. businesses told CNBC.
“There’s just no certainty or consistency and companies are very weary of this,” said William Bain, head of trade policy at the British Chambers of Commerce (BCC), which represents 50,000 businesses.
“They’re potentially looking at other options in terms of doing more trade with Europe or with the Indo-Pacific [region], where there seem to be less risk of fluctuations,” he told CNBC.
Uncertainty
Trump’s announcement that there would be blanket tariffs on all imports to the U.S. over the weekend brought further headaches to Europe’s business sector, which had seen the longstanding global trading order torn up last year.
In April, the U.S. upended the status quo by imposing a range of tariffs on trading partners across the world.
The new tariffs have raised alarm in Europe, with governments asking for more clarity from the White House as to what the new policy means for their trade deals. The EU negotiated a 15% duty on most exports with the U.S. in 2025.
CNBC has approached the U.K.’s Department for Business and Trade and the U.S.’ Department of Commerce for comment.
“The U.S. is seen as increasingly unpredictable and there remains some concern about the EU’s growth as they strive to compete with the world’s main trading blocs,” said Emma Rowland, trade policy advisor at UK business group the Institute of Directors (IoD), which represents around 20,000 business leaders.
As a result, firms are looking to diversify supply chains or reconsidering the U.S. as a market altogether, Rowland told CNBC.
U.S. President Donald Trump inspected an honour guard during a welcome ceremony at Buckingham Palace in central London on June 3, 2019, on the first day of their three-day State Visit to the U.K.
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“On the whole, businesses have been supportive of the way that the [U.K.] government has pursued a balanced approach to the UK’s international trading partners,” Rowland said. “That being said, of those who would want the government to prioritise a trading relationship, business leaders would overwhelmingly choose closer alignment with the EU over the U.S.”
For U.K. businesses, the BCC estimates that the tariff increase will raise the cost of U.K. exports by between £2 billion ($2.7 billion) and £3 billion across a 12-month period.
“Many companies have, for example, 12 to 18 months timelines for contracts on supply of goods, and at this point there’s very few companies who can say what the tariffs will be and what prices they’ll be able to charge in six months time,” said Bain.
U.K. sectors that could be most impacted by Trump’s new tariffs — should they come into force on Feb. 24 at 12.01 a.m. E.T. as previously stated — are food and drink, clothing and footwear and electrical and industrial goods, Bain told CNBC.
The “majority” of the U.K.-U.S. deals on car, steel and pharma tariffs were not expected to change but discussions were ongoing, the BBC reported, citing an official spokesperson of U.K. Prime Minister Keir Starmer.