UK expected to be hit hardest by Trumps latest tariffs after the 25% tax on $7.5bn of goods is set to start against the EU
There is a corner of Manhattans Greenwich Avenue that is forever England and right now its bloody angry.
This is absolutely draconian, ridiculous, huffed Sean Kavanagh-Dowsett, co-owner of the restaurant, Tea & Sympathy, the adjoining general products store and its neighbor, A Salt & Battery, a fish and chip shop, that has been serving all things British to locals and expats for 29 years.
Behind a store front of Union Jack flags, a red phone box and other symbols of Britishness, Kavanagh-Dowsett is bracing for the impact of a 25% tariff on $7.5bn of UK goods that is set to start on 18 October , the latest salvo in the Trump administrations trade war with the European Union.
Kavanagh-Dowsett went through the products that would be hit, including Jammie Dodgers, Scottish shortbread, clotted cream and Irish bacon. Its going to impact us, and as always its going to get passed on to customers.
The latest tariffs follow a World Trade Organization (WTO) ruling that the European Union unfairly subsidized the aerospace giant Airbus but it is just the latest in a seemingly neverending spat over tariffs that started even before Donald Trumps election.
Kavanagh-Dowsett had few kind words for Trump.
I think because he lives in this rarified world where hes never had to think about the cost of anything, because he doesnt pay his bills, hes detached from reality and doesnt really understand the cost of anything, he said.
The UK is the country expected to be hardest hit by Trumps latest tariffs, even though the UK is still in the midst of a messy and protracted exit from the European Union. And its not just scones and cream that will be affected.
Among those speaking out against the tariffs have been textile and clothing makers, who face the raised duties on wool and cashmere.
The trade group Walpole, which represents more than 250 luxury British brands including Alexander McQueen, Burberry and Tanqueray gin, voiced deep frustration at Trump administrations tariffs on goods including whisky, liqueur and wine; cashmere; bed linen and men and womens clothing.
It is of particular concern that these tariffs come at a time when there is already so much political and economic uncertainty, said a spokesperson, noting that 24% of British luxury goods are destined for North America.
According to the group, two-thirds of its members name the US as their priority export market.
To penalize businesses that are in significant expansion phases, looking for new routes into the US and creating products American consumers desire Johnstons of Elgin cashmere, Peter Reed bed linen, Savile Row suits, English wine and numerous Scotch whiskies will likely impact consumer choice as well as business growth.
Around 23% of exports from British luxury brands in 2017 headed to the US, with a majority of firms seeing it as the primary market for future growth, according to Walpole.
Overall, the British luxury sector, which employs 160,000 workers, is bracing for new pressure from the tariffs on top of a projected loss of 6.8bn in revenue in the event of no-deal Brexit.
The fashion and textile sector, itself anticipating a 1bn-a-year loss in revenue from a no-deal Brexit, will see exports worth 35m affected by the tariffs, according to the UK Fashion and Textile Association (UKFT).
Savile Rows tailors, a favorite of Wall Street bankers with several outposts in Manhattan, are expected to be especially badly hit, in part because French and Italian competitors are not affected by the additional levies. If UK manufacturers were hoping the US would provide a hedge against Brexit, the opposite is now true.