UK businesses will be potentially attractive to European businesses after Brexit and Donald Trump’s trade tariffs, an expert has suggested. The current trade environment places British firms in a good position, they argued, as Britain has negotiated trade deals with both the US and EU, and Mr Trump announced 15% tariffs on most of the bloc’s exports. In addition, Switzerland, which is not an EU member, faces a 39% tariff – the highest in Europe and fourth highest globally. This has “left many Swiss firms grappling with the threat of severe economic repercussions”, Aman Parmar, Head of Marketing at BizSpace, a small to medium business (SME) flexible workspace firm.

The EU and the US announced on July 29 that a trade deal would see a 15% ceiling on all EU exports currently subject to reciprocal tariffs. This also applies to cars and car parts, as well as any potential future tariffs on pharmaceuticals and semiconductors. However, European wines and spirits did not make it on the list of items exempt from the 15% levy. A 10% tariff will remain in force for countries with which the US has a trade surplus, which includes most states.

The House of Commons outlined the UK’s tariffs on July 30 as follows. In March, President Trump imposed a 25% tariff on all aluminium, steel and derivative goods imports.

From April 3, there was a 25% tariff on all passenger vehicles and light trucks. Tariffs of 25% on automobile parts were due to be implemented from May 3.

From April 5, a 10% baseline tariff on imports from the UK, affecting most goods.

Mr Parmar added: “This dramatic difference in tariff conditions could position the UK as a key indirect beneficiary of these tariffs, enabling it to reclaim some of the trade and investment lost post-Brexit.”

The expert also said: “The aftermath of the 2016 Brexit referendum saw many British businesses shift operations to mainland Europe, leading to initial uncertainties and a decline in exports.

“However, the prospect of US President Trump’s newly imposed tariffs is prompting companies to reassess their strategies.

“Similar to the situation faced by smaller Swiss firms, particularly in the watch and machinery sectors, UK SMEs might find themselves in a position to attract displaced EU businesses.

“In Switzerland, for instance, a fifth of the watches and jewellery produced are exported to the US; analysts suggest that the impact of US tariffs will disproportionately affect the lower-end segments of these markets.”

Swiss government held crisis talks on Monday in an attempt to finalise a proposal that might dissuade US President Donald Trump from imposing 39% tariffs on the country, Bloomberg reported.

Mr Parmar said: “With Switzerland now facing a staggering 39% tariff – the highest in Europe and globally the fourth highest behind only Syria, Laos, and Myanmar – it underscores the vulnerability of smaller exporters, which the UK could leverage to attract businesses seeking more stable conditions.”

The exodus of companies from the London Stock Exchange due to takeovers has reached the highest level in 14 years, in a major blow to Keir Starmer‘s government.

Forty-five firms have dropped their listings in the Capital so far this year because of mergers or acquisitions, according to figures compiled by Bloomberg, as concerns persist that economic conditions are putting off investment.

With the UK economy apparently on the brink, this year has seen a number of major deals, with the sale of video game company Keywords Studios to private equity company EQT, the sale of Virgin Money to Nationwide, and Thoma Bravo’s aquisition of cybersecurity leader Darktrace, according to The Telegraph.

The coming months are expected to bring further sales, including Carlsberg’s purchase of Britvic, and Czech billionaire Daniel Kretinsky’s bid to aquire IDS, the owner of Royal Mail.

Meanwhile, mining giant Rio Tinto, one the biggest firms on the exchange, is coming under pressure to de-list, with activist investor Palliser Capital telling the firm that its Anglo-Australian structure had cost shareholders £39.5bn.

The multi-strategy investment firm has called for an independent review of the arrangement to be launched.

It comes as business leaders and analysts have criticised the UK’s trading environment, with concerns about Britain’s ability to match other major economies.

Nikolay Storonsky, chief executive of fintech firm Revolut recently branded London listing as “not rational”, in an appearance on the 20CV podcast.

Storonsky cited the 0.5% stamp duty tax on trading as a factor, as he questioned how the UK measures up to the US.

This summer, Wealth Club, an investment platform for affluent and sophisticated investors, released its inaugural “British Wealth Report”.

It found that 55% of high-net-worth individuals feel the country does not support wealth creation or creators, while 42% consider the country an unattractive place to set up a business, as per Business Matters.

Meanwhile, 31% said they were more inclined to leave the UK for financial reasons compared to a year ago, in a major blow to Keir Starmer and Rachel Reeves.

Nicholas Hyett, Investment Manager at the investment service, said at the time: “The UK has an image problem. Wealthy investors view the country as an unappealing place to start a business, citing a culture unsupportive of wealth creators and burdensome taxation.

“These individuals are crucial to the UK economy. The top 100 earners contribute an average of £46 million in tax each, while the highest-earning 100,000 cover a quarter of the total income tax and capital gains tax bill, despite representing just 0.3% of UK taxpayers.

“This data, obtained via a Freedom of Information request to HMRC in November 2023, underscores the importance of changing this group’s perception of the UK.”

Last week, a Treasury spokesperson said in an statement to City Am that Chancellor’s “top priority is growth and making the UK the most attractive place to invest”.

“UK capital markets have raised more equity capital in 2024 than the next three European exchanges combined, and recent reforms to Listings Rules will make us an even more attractive destination for exciting businesses,” they added.

A Treasury spokesperson said: “Growth and driving more investment in the UK is our number one mission.

“Recent IPOs and listing announcements by high-growth companies like Raspberry Pi and Canal+ demonstrate confidence in our capital markets and there is more we can do to attract exciting businesses to the UK.

“That’s why we are creating pension megafunds to unlock billions of pounds of potential investment for businesses, as well as backing the largest overhaul of UK listings rules in decades.”

Express.co.uk has approached Rio Tinto for comment.

The UK economy flatlined in July for the second month in a row, according to the latest official figures, in a significant setback from Chancellor Rachel Reeves and recently installed Prime Minister Sir Keir Starmer.

The Office for National Statistics (ONS) said gross domestic product (GDP) recorded no growth in July.

Economists had been expecting GDP to edge up by 0.1 percent in the month, according to a consensus provided by Pantheon Macroeconomics.

The latest data comes after the economy continued its recovery from recession at the end of last year, with growth of 0.6 percent between April and June.

ONS director of economic statistics Liz McKeown said: “The economy recorded no growth for the second month running, though longer term strength in the services sector meant there was growth over the last three months as a whole.

“July’s monthly services growth was led by computer programmers and health, which recovered from strike action in June.

“These gains were partially offset by falls for advertising companies, architects and engineers.

“Manufacturing fell, overall, with a particularly poor month for car and machinery firms, while construction also declined.”

Commenting, Sam Kirk, Managing Director at J-Flex Rubber Products commented: “All eyes in the economy are very much on the forthcoming Budget.

“Visibility, or rather the lack of it, is currently a major challenge for many SMEs throughout the supply chain, with some reluctant to press ahead with plans until there is clarity after the Autumn Budget.

“Businesses will be nervously waiting to hear whether Labour announce further tax hikes or increased borrowing, which, if true, will only add to inflationary pressures and undermine business confidence.

“I truly hope Labour can deliver a Budget that both revitalises the economy and reassures sceptics like me. I fear that may be too much to ask, and that we’ll just be left with even more uncertainty.”

Posting on X, Julian Jessop, Economics Fellow at the Institute of Economic Affairs, said: “Surprisingly weak UK #GDP data for July – no growth for the second month running…

“Monthly data can be erratic – the less volatile 3m/3m measure still rose 0.5 percent – but the poor July numbers are hard to square with the positive tone of the business and consumer surveys.”

Riz Malik, Independent Financial Adviser at R3 Wealth suggested the case for an interest rate cut had been bolstered.

He said: “No growth Britain could put Britain into recession very quickly.

“Is this enough for a September rate cut?

“Unlikely, but it adds weight to further rate cuts before the year is out.”

Isaac Stell, Investment Manager, Wealth Club, said: “The month-on-month GDP figures missed all estimates producing a fairly dismal set of numbers with the services sector managing to mitigate the declines seen in the construction and manufacturing sectors.

“A reversal in the fortunes for the manufacturing and construction sectors is a blow to the new Labour Government that has growth as a central pillar of its agenda.

“The usual bright spot was the bounce back in growth for the services sector with the health sector one of the leading contributors, springing back to life following strike action in June.

“A notable slowdown in advertising and architects may be indicative of a wider slowdown.

“With the canaries beginning to look a bit peaky, the chancellor may need to tread more carefully in October.”

Readers of a certain age may remember the 1940s radio comedy ITMA (It’s That Man Again). One of its characters was the lugubrious Mona Lott. Her catchphrase, “It’s being so cheerful that keeps me going,” long outlasted the show’s demise.

That was eight decades ago but it could have been written about Keir Starmer. Since taking office in July, the Prime Minister has turned gloom and misery into a programme for government – never missing an opportunity to bemoan how terrible everything is because of the “deep rot” left by the previous government.

And if you think things are bad enough now, just you wait, he tells us – things “will get worse before they get better”. Next month’s Budget, Sir Keir promises, is going to be painful – especially for those who he says can afford to take a hit.

Let’s ignore, for the sake of argument, whether he and Chancellor Rachel Reeves are right to talk about a previously undiscovered £22billion “black hole” (they’re not). And let’s ignore the arguments Ms Reeves has made about inheriting the worst economic mess since World War Two (it’s a preposterous idea – 1979 was worse by an order of magnitude).

Because even if you think they are correct about the appalling state of the economy, there are profound economic consequences from their non-stop focus on doom – namely that entrepreneurs and businesses have reacted accordingly to the continual warnings of “shortterm pain” albeit for “the longterm good”.

A report yesterday by the Recruitment and Employment Confederation and consultants KPMG warned that companies have already started holding off hiring employees. That’s hardly a surprise. Last month, for example, Treasury minister Darren Jones dropped a heavy hint that employers will have to pay more in National Insurance for their staff.

Labour has previously promised not to increase NI. Jones now speaks only of not increasing “employee National Insurance” – in other words leaving the possibility of increasing the employer part of it. That would be a straightforward tax on jobs (as well as a betrayal of an unambiguous promise) – making it more expensive to hire staff.

His seemingly precisely formulated words set a hare running. It may be that NI will not, after all, be increased. But no one knows at the moment, so it is entirely rational for businesses to hold off employing new workers until they find out in the Budget what will actually happen.

Increasing employment is, of course, a prerequisite of the economic growth that Labour says is its focus, which makes the very idea of increasing NI a truly bizarre idea. This same thought process for prospective employers applies far more widely than this one specific tax.

As the report puts it: “Recent Government warnings that the UK’s economy may weaken further before improving add to the overall sense of uncertainty, affecting recruitment plans. Firms holding back from hiring led to a sharp contraction in the number of people placed into permanent roles in August.”

If Starmer and Reeves had set out to stop businesses feeling encouraged to invest they could hardly have found a more successful method. Instead of setting out a vision of a prosperous nation building for the future, their near despondency about the state of the economy has encouraged a sense of pessimism among the very people we need to be optimistic about our prospects.

People, that is, like the wealthy investors who are moving overseas, according to another report by Henley & Partners, which shows a net loss of 4,200 millionaires in the first five months of the year. A further 5,300 are expected to leave before next year. I t’s not just increased taxes and gloomy words, though.

This week’s TUC is the first since Baroness Thatcher was PM that takes place under a government planning to roll back the employment and trades union law reforms that began in the 1980s and have been the bedrock of our labour market ever since.

Labour sees the union laws of the 1970s not as a symptom and cause of Britain’s historic economic malaise but as a model to be recreated. Of course employers are reluctant to commit to hiring new staff when the Government seems intent on saddling anyone who does so with deleterious financial and legal obligations.

Labour’s manifesto pledged to restore trust in politicians and heal “the weariness in the heart of the nation”. Instead, within a few weeks, it has deliberately turned misery into its raison d’etre.