Sir Keir Starmer will declare the end of globalisation and admit it has failed the public amid the growing fallout of Donald Trump imposing global trade tariffs, including 10 per cent on the UK.
The prime minister will argue in a speech on Monday that the shock from the US president’s trade war means Britain must “move further and faster” cutting red tape to boost economic growth.
And, in an article on Sunday, Sir Keir said “the world as we knew it has gone”. “We must rise to meet the moment,” he said.
And, in a flurry of announcements this week aimed at boosting growth, chancellor Rachel Reeves will then make a statement loosening regulations on electric vehicle manufacturers and accelerating Labour’s industrial strategy.
“Trump has done something that we don’t agree with but there’s a reason why people are behind him on this,” a Downing Street official told The Sunday Times.
They added: “The world has changed, globalisation is over and we are now in a new era. We’ve got to demonstrate that our approach, a more active Labour government, a more reformist government, can provide the answers for people in every part of this country.”
Sir Keir will appeal to the US president, arguing he understands Mr Trump’s America-first approach after years of voters feeling worse off amid free trade and mass migration. The PM will also stick to his approach by not imposing retaliatory tariffs on the US.
Ms Reeves will then reportedly visit India to accelerate progress on a trade deal with the country, while officials work to strike an agreement with Australia.
Sir Keir has pledged to “do everything necessary” to protect the UK’s national interest in the wake of Mr Trump’s imposition of tariffs, with ministers “ready to use industrial policy” to help shelter businesses.
Hours after Jaguar Land Rover paused shipments to the US, with businesses struggling to adapt to the new rules, the PM said “these new times demand a new mentality”.
Writing in The Sunday Telegraph, Sir Keir said that when it comes to tariffs, “the immediate priority is to keep calm and fight for the best deal”.
He added that in the coming days “we will turbocharge plans that will improve our domestic competitiveness”, and added: “We stand ready to use industrial policy to help shelter British business from the storm.”
And chief secretary to the Treasury Darren Jones confirmed Sir Keir will unveil plans to boost British industry this week, adding: “He thinks globalization has failed in the current context, and that we need to go further and faster in supporting British industry and the British economy.”
The FTSE 100 had its worst day of trading since the start of the pandemic on Friday, with banks among some of the firms to suffer the sharpest losses.
Sir Keir said: “This week, the Government will do everything necessary to protect Britain’s national interest. Because when global economic sands are shifting, our laser focus on delivering for Britain will not. And these new times demand a new mentality.”
The PM has been calling world leaders over the weekend to chart a course in response to Mr Trump’s tariffs, and shared his “concerns” about the impact on global economics and security in a call with Emmanuel Macron.
While the UK is set to continue at the 10% baseline, other nations are due to see their tariff rates increase further next week.
Some of the highest tariff rates have been applied to nations in South-East Asia, with imports from Vietnam will be subject to a 46% tariff, while those from Cambodia will face a 49 per cent rate.
Imports from France will see a 20 per cent tariff, the rate that has been set for EU nations.
In a post on his TruthSocial platform, the president said: “We are bringing back jobs and businesses like never before. Already, more than FIVE TRILLION DOLLARS OF INVESTMENT, and rising fast! THIS IS AN ECONOMIC REVOLUTION, AND WE WILL WIN. HANG TOUGH, it won’t be easy, but the end result will be historic.”
