DONALD TRUMP’S return to the US presidency casts an uncertain shadow over the UK, potentially leading to economic shocks that could burden British households with higher costs, lower growth, and less job security. His policy unpredictability and “America First” doctrine spell challenges for UK businesses, while his strong-willed approach to trade and foreign policy could drive a wedge between the two countries.

TRADE TENSIONS COULD COST UK EXPORTERS

Trump’s protectionist stance has reignited concerns about tariffs, which could cut deep into the UK economy. The US is Britain’s largest export market, receiving around 25% of all UK-manufactured exports. Proposed tariffs of up to 10% on imports to the US would affect major British exporters such as Rolls Royce and BAE Systems, impacting an estimated £56 billion in trade. If enacted, such tariffs could push costs higher, threatening thousands of jobs in sectors dependent on American demand.

A STRAINED UK-US RELATIONSHIP

While Prime Minister Keir Starmer and Foreign Secretary David Lammy have made diplomatic overtures to Trump, attending dinners and working closely with Trump’s allies, challenges in the relationship remain evident. Starmer’s reserved style contrasts with Trump’s brash manner, raising questions about how compatible their leadership styles are. This uncertainty, highlighted by one diplomat’s remark that Trump “doesn’t give a stuff” about UK relations, suggests a bumpy road ahead.

Diplomats have tirelessly built relationships with Trump’s inner circle, including former Secretary of State Mike Pompeo and Trump’s likely national security adviser, Elbridge Colby. However, Trump’s mercurial nature, marked by unpredictable social media outbursts and contentious negotiations, may test these connections. As Lammy put it, relations with Trump are likely to be “bumpy, noisy, and transactional.”

ECONOMIC FALLOUT AND SLOWER GROWTH

The potential for UK economic slowdown under Trump’s policies is profound. Economists from the National Institute of Economic and Social Research (NIESR) predict UK growth will be halved if Trump enforces his proposed tariffs. Without tariffs, the UK could expect moderate growth of around 1.2% next year; however, this figure could drop as low as 0.4% should the trade restrictions come into force. Coupled with rising inflation, this could lead to diminished purchasing power for households already grappling with a cost-of-living crisis.

CURRENCY VOLATILITY AND JOB THREATS

Trump’s victory has already weakened the pound, with the GBP/USD exchange rate falling sharply as results came in. Investors are wary of increased tariffs and Trump’s isolationist policies, both of which could stoke currency volatility and strain the UK economy. A weakened pound also drives up the cost of imports, which affects consumers directly through higher prices for everyday goods.

The potential loss of thousands of jobs in sectors heavily reliant on US trade adds to the bleak outlook. Automotive manufacturing, for instance, could be heavily impacted by Trump’s threat of a 100% tariff on imported cars. Companies like Jaguar Land Rover, whose Land Rover Defender was one of the UK’s top exports to the US, may face cutbacks if tariffs make exports uncompetitive.

UNCERTAIN INVESTMENT ENVIRONMENT

The UK’s global-facing stock market may also suffer. Companies in the FTSE 100 and FTSE 250, which derive significant profits from international operations, could experience volatility as Trump’s policies introduce uncertainty into transatlantic trade. Such uncertainty could lead investors to shy away from the UK market, diminishing capital inflows and further affecting economic growth.

SHIFTS IN GLOBAL PRIORITIES

Beyond economic pressures, Trump’s foreign policy outlook could exacerbate the UK’s security challenges. Trump’s “America First” rhetoric and emphasis on Asia over Europe may leave European allies, including the UK, less confident about US support for initiatives like defending Ukraine. While the UK has publicly aligned with Trump’s view that Europe should shoulder more of its defense costs, there are fears that a US pivot to Asia could weaken the cohesion of NATO and reduce military backing for Europe.

Lammy has attempted to foster an understanding of Trump’s instincts, acknowledging his focus on American interests and recognition of Asia’s growing influence. However, as the UK looks toward cooperation on issues like Ukraine, this alignment may prove insufficient in securing the support needed to address shared security concerns.

BRITISH FAMILIES TO SHOULDER THE COST

For British families, the impact of a Trump presidency could hit close to home. With increased tariffs potentially driving up inflation by 3-4%, the Bank of England may feel compelled to raise interest rates by as much as 2-3% in response. For households already feeling the pinch from rising prices, this could lead to higher mortgage costs, increased borrowing rates, and a tougher job market, further squeezing living standards.

Though the UK government has prepared for Trump’s return, the effectiveness of these plans remains to be seen. As Britain braces for another unpredictable chapter with Trump at the helm, citizens may face a “bumpy, noisy, and transactional” relationship that could reshape the economy, impacting everything from job security to the prices at the supermarket.

Donald Trump has been elected the 47th President of the United States, securing a remarkable return to power after his first term’s turbulent end. His victory caps a four-year journey marred by controversies, including a refusal to concede his prior defeat, a violent Capitol insurrection, felony convictions, and surviving two assassination attempts.

Trump clinched the presidency by winning Wisconsin, reaching the required 270 electoral votes. His combative approach resonated deeply with his base, fueling support with a fierce campaign against his Democratic opponent, Kamala Harris, whom he attacked in intensely personal terms. Trump’s rhetoric painted an apocalyptic vision of America, claiming it was overrun by violent migrants and dominated by social chaos. This stance found a strong following, particularly among men, in an increasingly polarized nation.

“Unprecedented mandate”

In a victory speech Wednesday morning, Trump proclaimed an “unprecedented and powerful mandate” from voters. The election season proved historically contentious, marked by Trump’s survival of two assassination attempts and the sudden replacement of Joe Biden with Kamala Harris as the Democratic nominee. Harris, the first woman of color to lead a major party’s ticket, struggled to differentiate herself from the current administration’s challenges as Biden stepped aside amid concerns about his age.

Trump, now 78, becomes the oldest elected president and the first former president to reclaim office since Grover Cleveland in 1892. His running mate, Ohio Senator JD Vance, at 40, becomes one of the youngest vice presidents, representing the millennial generation in the highest ranks of American government.

Aggressive agenda

In his second term, Trump has pledged to reshape the federal government and pursue retribution against opponents. With most of his Republican critics in Congress sidelined, he faces fewer constraints. The Supreme Court, now including three Trump-appointed justices, recently ruled in favor of expanded presidential immunity from prosecution, further strengthening his position.

Trump’s victory reflects a national divide over democracy, as seen in a comprehensive survey showing many voters motivated by fears for democratic integrity. Harris campaigned hard on this theme, warning against Trump’s authoritarian tendencies. Yet Trump’s supporters, motivated by concerns over immigration and inflation, backed his hardline stance.

Violence and tumult on the campaign trail

The campaign’s climax was marked by a dramatic incident in July when a gunman fired at a Trump rally in Pennsylvania, grazing Trump’s ear and killing a supporter. Despite blood streaking his face, Trump raised his fist defiantly to the crowd. Weeks later, Secret Service agents thwarted another assassination attempt while Trump was golfing, discovering a weapon in the bushes.

His return to the White House seemed improbable in early 2021, following his departure from Washington amid isolation and impeachment after the Capitol riot. Many dismissed him, but Trump maintained a stronghold from Mar-a-Lago, securing loyal Republican allies like Kevin McCarthy, who visited him shortly after he left office, affirming his continued influence.

Now, Trump enters his second term with sweeping plans to transform American governance, reinforce control, and settle scores, ushering in an era likely to be as divisive and consequential as his first.

THE KREMLIN adopted a measured stance on Wednesday after Donald Trump claimed victory in the U.S. presidential election, casting doubt on whether his campaign promises to end the Ukraine conflict would materialize in policy. Kremlin spokesperson Dmitry Peskov stressed that Russia still perceives the U.S. as a hostile state, directly and indirectly entangled in the ongoing conflict in Ukraine, which began with Russia’s invasion in 2022.

Trump, reportedly poised for the presidency following a Fox News projection of his win over Democrat Kamala Harris, campaigned on swiftly ending the Ukraine war. However, Peskov stated that only time will show if Trump’s words carry substance. “The U.S. remains an unfriendly nation, heavily involved in efforts against our state,” he told reporters, adding that President Vladimir Putin has no immediate plans to congratulate Trump on his projected victory.

While Peskov acknowledged a potential shift in U.S. foreign policy under Trump, he tempered expectations given the historically strained U.S.-Russia relations. “The U.S. could contribute to ending this conflict, but a change in policy trajectory will not happen overnight. Whether Trump will alter course once in office remains uncertain,” he commented.

Despite Moscow’s claims of neutrality regarding the U.S. election outcome, Kremlin-backed media has hinted at a preference for Trump. Kirill Dmitriev, head of Russia’s sovereign wealth fund, expressed optimism, suggesting that a Trump presidency could “reset” U.S.-Russia relations, recalling previous unsuccessful diplomatic efforts.

The war in Ukraine has drawn Russia and the West into the most severe standoff since the Cold War. Russian forces currently hold around 20% of Ukrainian territory, including Crimea, annexed in 2014, and substantial areas in Donbas and Zaporizhzhia. Trump has vowed to bring the conflict to an end but has yet to clarify his strategy. Russian officials, including former President Dmitry Medvedev, speculate that Trump’s business-oriented approach might reduce U.S. support for Ukraine. “Trump, as a businessman, dislikes wasteful spending, which may lead him to push back against further resource allocation to Ukraine,” Medvedev posted on Telegram.

While Putin has previously indicated openness to peace talks—contingent on recognition of Russia’s territorial claims, a stance firmly rejected by Ukraine—the Kremlin is cautiously observing Trump’s return to the White House. Moscow remains alert to potential policy shifts, hopeful for a diplomatic opportunity but aware that substantial changes may be slow in coming.