David Lammy, the Foreign Secretary, has said that he would seek to broker a deal. He told the BBC’s Newscast: “Of course, we would seek with a new administration to ensure that as a major ally we were aligned and we were considered, obviously. That’s in Britain’s national interest. Of course we do that.
“We will seek to ensure and to get across to the United States, and I believe that they would understand this, that hurting your closest allies cannot be in your medium or long-term interests, whatever the pursuit of public policy in relation to some of the problems posed by China.”
The UK is in a strong position to negotiate, says Bain, who was a member of the Commons’ business, innovation and skills committee while an Opposition MP.
“We have burgeoning trade – particularly in terms of services,” he says. “Bilateral trade is £304bn per year. That’s growing. Our services export growth is very strong. In terms of goods, nearly £62bn per annum of UK goods are sent to the US.
“The other thing to remember is that the US is the largest inward investor into the UK. There’s about £700bn-odd in investment stock from the US, which is held in the UK. You can see the enduring strength of that economic and investment trading relationship – whatever the political leadership is in Washington.
“There is a strong case for keeping tariffs as low as we can,” he says.
Pickering also notes that half of the UK’s exports are made up of services, which are very hard to place tariffs on and unlikely to be targeted.
“I don’t think it’s clear that the UK will be facing serious risks,” Pickering says. “That’s what the market is telling you.”
‘At least we’re not first in the firing line’
Sterling has strengthened by 0.8pc against the euro since it became clear Trump had won. Meanwhile, the pound is up by 0.6pc against the yen. Both Japan and the euro zone are much more exposed to any tariffs on China than Britain is.
The UK’s goods exports to the US account for around 2pc to 3pc of the size of the economy. Even if they were to be hit with tariffs, Pickering argues the overall economic impact would be small.
“If you were to consider the impact of a 10pc or 20pc trade tariff on that, as long as the UK didn’t retaliate you’d be thinking about marginal economic impacts,” he says.
Henig admits that Trump’s embrace of tariffs is “not great”, but says: “On the other hand, he doesn’t particularly regard the UK as a problem. He often goes on about China or Germany, not usually about the UK. At least we’re not first in the firing line.”
He believes Trump will only follow through on some tariff threats. “It’s a bargaining chip. It’s just going to be a bit chaotic,” Henig says.
Trump has several golf courses in Scotland, he adds, which he will have a vested interest in maintaining and may prove influential.