Dale speaks to Westminster correspondent Alexander Brown about the effects of USA tariffs on Scotland and the UK
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00:00Hello and welcome to the Scotsman for this Thursday.
00:04We're here for the Daily Bulletin.
00:06My name is Dale Miller.
00:07I'm Deputy Editor of the Scotsman
00:08and I'm joined by our Westminster correspondent,
00:11Alexander Brown.
00:12It is the day after what Donald Trump
00:14labelled Liberation Day in the US
00:17and it led our front page of today's paper.
00:21Trump pointing down the barrel.
00:23The UK hit with a 10% levy as Trump tariffs unleashed.
00:28A statement was given in the White House Rose Garden
00:31from 9 p.m. UK time.
00:34As Trump laid out what he had forecast,
00:36we didn't know what tariffs the UK was gonna get hit by.
00:41As it turned out, it was the minimum threshold
00:43but there's a bit to talk through on this front.
00:45Alex, can you talk through just the details
00:48of the announcement firstly
00:49and some of the language that Trump used as well?
00:53So the language was pretty remarkable.
00:55He basically said that the United States
00:57had been taken advantage of by other countries for decades,
01:01that it wasn't the fault of the other countries
01:03because they had just made good deals.
01:05It was the fault of every other president
01:07who'd come before and not done a good job.
01:10He said it was a blow to businesses in the US.
01:12He said that they were poor
01:14and now because of these tariffs,
01:16they would be wealthy and rich again,
01:18which is perhaps news to many of the countries
01:20who've been hit with the hardest tariffs, such as Vietnam.
01:24And I think it's worth saying there is a scale of tariffs.
01:26In this pantheon, the United Kingdom got off
01:29relatively lightly with a 10% tariff
01:32on all goods going into the United States.
01:34That will be 25% for automobiles.
01:38Contrast, I think the EU was closer to 20.
01:41Some countries have as high as maybe 50 or 60% tariffs
01:45because this is part of a huge trade war.
01:48It was really interesting that during his speech,
01:50he brought on a man, I think it was called Brian,
01:53who looks kind of like a budget Hollywood Hulk Hogan
01:56with a blonde mustache who talked about the fact
01:59that he worked in a business plant, in a plant even,
02:01and he'd seen all these numerous factories close,
02:04but that wasn't going to happen anymore
02:06because of Donald Trump.
02:07Well, I'm not sure that's necessarily true
02:10given the price of consumers in the United States
02:12will go up and they won't necessarily
02:14be producing more themselves, but that was the narrative.
02:17It was, we're gonna make things ourselves.
02:19Other countries should be buying things here.
02:21And if they're not gonna make things in America themselves,
02:23we won't be buying their stuff.
02:25It was essentially, you either bring your stuff here
02:27and make it with us and give us money to help you make it,
02:31or you will suffer the consequences.
02:34Look, it almost felt like a bit of a caricature
02:36when he pulled out the tariff board
02:39and it had a breakdown of the percentages.
02:42China, for example, 30 odd percent.
02:44UK got off lightly, shall we say 10%.
02:49Some other major trading partners
02:51like Australia and New Zealand got 10%,
02:54but particularly high for some parts of Asia.
02:57For example, by Singapore,
02:59I think a lot of Southeast Asian nations
03:01had hefty increases.
03:03But then it spoke through the tariffs
03:06that they were levying on the US.
03:08How have they done the mathematics on this, Alex?
03:11Is that something that you can explain at all?
03:14They've not done it through any typical measure.
03:16I mean, he's completely misunderstood,
03:19for example, United Kingdom, VAT.
03:21He has decided that VAT is a tax.
03:24It's not just something that everyone has to pay.
03:27It's a tax on other countries.
03:29The way these figures put together
03:31is not through basic mathematics.
03:34It's not through any normal comprehension
03:36of international economics and finance and trade.
03:40And this morning, numerous countries
03:41were having basically writing themselves
03:44about how they are aghast and confused
03:46as to how he has got these numbers.
03:47So I can't tell you the exact system,
03:50but then many other countries can't either.
03:53What I can tell you is that there is now great concern
03:56for what this means for Scotland,
03:58but there is actually hope
03:59that maybe these issues can be mitigated.
04:01So ultimately, the 10% tax means, tariff even,
04:04means everything's being sold by the United Kingdom
04:08to the United States will cost 10% more.
04:12That cost is likely to then go onto the consumer
04:15in the United States,
04:16who will then presumably buy less of it.
04:19By doing that, that means the profit margins
04:21or profit in general will be hit in the UK and in Scotland.
04:24So whether it's whiskey, whether it's salmon,
04:27both of which count the US as either their greatest
04:30or their second greatest exporter,
04:33and then that's going to perhaps even impact jobs.
04:35If they make less money, the business does not do as well,
04:38that can then impact jobs.
04:40The great hope to avoid that, however,
04:42is this economic deal.
04:44We know that Starmer and Trump
04:46seemingly have a good relationship.
04:47There is a closeness.
04:49The United States president even joked
04:50about how charming he was
04:52and that maybe he would be able to do something on tariffs
04:55because of how kind he was.
04:57We may be at that point.
04:58There are negotiations.
04:59The business secretary, Milton Reynolds,
05:01said this morning that a deal was basically ready to go.
05:04The expectation is there is an economic deal agreed
05:06that could include ending this tax on digital companies,
05:10such as social media companies,
05:12which we know that Elon and the White House
05:14have pushed to get removed.
05:16They want that taken away from their businesses.
05:18And if that happens,
05:20it may be the case that a deal is agreed,
05:22which means these tariffs are no longer a problem.
05:24But right now, we don't have a timescale on it
05:27other than an expectation.
05:28We don't have any of the fine details
05:30and businesses face an anxious wait
05:32to know exactly what this means for them.
05:34And I'm interested in the political reaction here
05:37because it's not always the case in the UK
05:41and the Scottish governments are in lockstep with each other,
05:43but they have been.
05:44We've had Kate Forbes on the radio this morning
05:46saying cool heads are needed.
05:49We don't want a global trade war
05:52and very, very similar language coming from Sir Keir Starmer.
05:55So it seems like both governments here are on the same page.
05:59How do you think the UK government should
06:02and how do you think they will approach things from here?
06:05Well, I think there is a recognition
06:07that the United Kingdom does not have the biggest say
06:12on what happens here.
06:13It cannot take a firm stance.
06:15It is not like the EU bloc,
06:16which can retaliate as a collective
06:19with retaliatory tariffs.
06:20It doesn't have that financial clout to do so.
06:23Instead, what maybe Brexit has enabled,
06:26perhaps this could be the very first Brexit bonus,
06:28is this almost outsider element
06:30where the UK can strike its own economic deal
06:34to mitigate it.
06:35Responding with tariffs would hurt the UK
06:37far more than it would hurt the US.
06:39And it's not really,
06:40that's not how you do business with Trump.
06:42It's about flattery, it's about support,
06:45and it's about ignoring some of his worst elements
06:48to kind of get him as close to what's possible
06:52for normal democracy.
06:52So we are not, we even heard from Prime Minister
06:55this morning, I think he spoke to a business group
06:57very early this morning, a release went out,
06:59and he said, we're not gonna engage in a trade war.
07:01We will do what we've always done, we will be measured.
07:04And that will be the theme.
07:05It will be measured, it will be slow.
07:07You're not gonna get a running commentary.
07:09We're going to hear a statement
07:10probably by the time our viewers are watching this,
07:12we'll have heard again for the business secretary
07:15making a statement in the commons.
07:16And in that, I'm expecting him to say,
07:18we are addressing this, we're working on an economic deal,
07:21hang tight, we are gonna support businesses,
07:23we are taking all measures, nothing's off the table,
07:26but nothing's gonna be announced right now.
07:28And I think that will be what happens.
07:29It's gonna be in slow, calm,
07:31and really all eggs in the basket of an economic deal
07:34to stop the real impact of this happening.
07:38Alex, thanks for talking that through with us.
07:40You can read a piece from Alex
07:42on what the tariff announcement means
07:45for Scotland and Scottish businesses at scottsman.com.
07:50If you can't find any of the coverage,
07:51just click on the politics tab in the navigation bar.
07:55If you also wanna know the full list
07:57of what every country has been charged tariff-wise,
07:59you can read that on the site as well,
08:01including details of Trump's announcement
08:04and when the tariffs do start to come into effect
08:09over coming days.
08:10Alex, thanks to you,
08:11and thanks to everyone else for joining us.
08:15♪♪