Reeves unveils £20bn lifeline for exporters

THE UK pledged £20 billion last Sunday (13) to help exporters, including those affected by US tariffs, as president Donald Trump’s sweeping stop-start import taxes roil global markets.

The Treasury said the move would expand the UK’s export finance package by £20 billion to a total of £80 billion, with “thousands of UK businesses affected by tariffs set to benefit.”

Up to £10 billion of that support will be used specifically for firms “impacted in the short term by the current situation,” it said.

Chancellor Rachel Reeves said the move would help companies weather difficulties ahead.

“The world is changing, which is why it is more important than ever to back our world-leading businesses and support them to navigate the challenges ahead,” she said.

Small businesses will also be able to access loans of up to £2 million as part of the package, the Treasury said.

Analysts warned that the 10 per cent levy on US imports of British goods could further weaken business and consumer sentiment in the UK.

Specific industries such as auto, steel and aluminium face even steeper tariffs as high as 25 per cent. The United States is the UK’s single largest country trading partner, with over £1.2 trillion invested in each other’s economies.

News of the support came as official data showed last Friday (11) that Britain’s economy grew far more than expected in February.

Gross domestic product rose 0.5 per cent in the month, rebounding from an upwardly revised figure of zero per cent growth in January, the Office for National Statistics (ONS) said.

In another boost, the ONS also revised its figures from January to zero per cent growth, up from a 0.1 per cent contraction.

“These growth figures are an encouraging sign, but we are not complacent,” Reeves said.

“I know this is an anxious time for families who are worried about the cost of living and British businesses who are worried about what this change means for them,” Reeves said.

The Labour government has struggled to kickstart growth since it came to power in July.

Separate trade figures showed British goods exports to the US rose by £500 million ($650m) to their highest since November 2022, while imports increased by £200m. Businesses may have been trying to rush goods to the United States before tariffs took effect, some analysts said.

The ONS said the figures might show a change in behaviour but also highlighted that the monthly figures were often volatile.

Under the strain of tight public finances, Reeves recently announced billions of pounds of spending cuts, including to disability welfare payments, in the hopes of shoring up the public purse.

ONS director of economic statistics Liz McKeown noted that there was “widespread growth across both services and manufacturing industries,” in February.

“Across the last three months as a whole, the economy also grew strongly with broad-based growth across services industries,” she added.

Even before the tariff announcement, Britain and other European economies had slowed due to worries about US trade policy.

British businesses also said they were reining in hiring and investment plans due to a big rise in employment taxes and the minimum wage that took effect this month.