Rachel Reeves will use her appearance at the summit of the world’s most influential politicians and investors to turn Donald Trump’s global turmoil into an opportunity for the UK.
The chancellor and business secretary Peter Kyle will both be attending the World Economic Forum (WEF) in Davos with a message to investors that in a time of uncertainty, the UK “offers the stability” that businesses need.
With President Trump once again threatening to disrupt world trade with a series of tariffs linked to his demands over the US taking ownership of Greenland from Denmark, Ms Reeves will make a series of pointed remarks as she arrived at the gathering in Davos, Switzerland.
“In a volatile world Britain stands out”, she will say. “This government is making sure Britain is home to the stability, talent and capital that businesses and investors want and that drive greater growth.
“Some countries give you a platform, but Britain gives you momentum. My message at Davos this week is clear: choose Britain – it’s the best place in the world to invest.”
Meanwhile, Mr Kyle used an interview with the Press Association to underline that the “normalisation” of disruption which Trump represents could be an opportunity for the UK.
While he said that tariffs are a “lose-lose” policy and “the stakes are always very high”, he added that there are also “opportunities in adversity” for British exporters.
He continued: “The risks are very, very clear, but our country in adversity has benefited more than others, and I want to – now adversity is being normalised in a global economy – I want us to really look deeply into that and see where the opportunity is for British businesses, exporters, innovators, but also how we as a country can be more entrepreneurial, fleet of foot, bolder when it comes to seeing global opportunities amidst the uncertainty and upheaval.”
It came amid warnings that the new export levy could wipe 0.1 per cent off Britain’s GDP – increasing to as much as 0.3 per cent if the tariff is increased to 25 per cent as Mr Trump has threatened – a hit that could tip the UK’s ailing economy into recession.
One land of opportunity for British businesses could be China, where the prime minister is expected to visit early this year to boost trade links.
Asked if China was now a better trading partner than the US, Mr Kyle said: “Every country that we have relationships with is unique, unique opportunities, as well as issues that need to be handled.
“In China, because of the scale of the opportunity and the nature of the issues that need handling, it is a more extreme example.
“That means we need to be careful, clear-sighted, but also not lose sight of the fact it is the second biggest economy in the world, it is the largest manufacturer in the world and its products will find their way into our economy.”
The same interview saw him admit that the UK’s relationship with Mr Trump’s US administration is being tested by the Greenland crisis.
While Mr Kyle said UK ministers have “good, strong relationships” with their US counterparts, noting that the government is in regular contact with US commerce secretary Howard Lutnick and US trade representative Jamieson Greer, he admitted: “At moments like this, relationships are tested. And yes, of course, we’re having frank conversations.
“But in my experience, all of the key protagonists in the administration thrive on frank conversations and wouldn’t have it any other way.”
Mr Trump has said he will impose 10 per cent tariffs on imports from the UK, Denmark, Norway, Sweden, France, Germany, the Netherlands and Finland from February 1, rising to 25 per cent from June, unless a deal is reached for the “complete and total purchase of Greenland”.
In an emergency address from Downing Street on Monday morning, Sir Keir Starmer described the crisis as a “moment for the whole country to pull together”, and insisted the “right way to approach an issue of this seriousness is through calm discussion between allies”.
But in a sign of the seriousness with which the government appeared to be taking the threats from the US, Ms Reeves was among the senior Cabinet ministers sat in the audience at the prime minister’s announcement, having pulled out of a Monday morning event at the London Stock Exchange.
Sir Keir also abandoned plans for a Monday cost-of-living related visit at the 11th hour to make the announcement, with the PM promising to speak with the US president about Greenland again in the coming days after the two spoke on the phone on Sunday night.
