Brexit made businesses abandon the UK. Trump's hefty EU tariffs could bring them back
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President Trump's threatened 30% tariffs on the EU might prompt some businesses to take another look at the U.K.
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6 min read
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investment
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July 21, 2025
06:28 AM
CNBC
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From what the evidence shows, Finds itself in something of a sweet spot when it comes to trade, given it has deals with both the U
And European Union, in today's financial world
That's a turnaround after the uncertainty that ed the 2016 Brexit referendum, which mpted es to shift operations to mainland Europe and exports to fall
President Donald Trump's threatened 30% tariffs on the EU might drive some es to reconsider the U
A European Union (EU) flies alongside a British Union flag, also known as a Union Jack in London (quite telling)
Jason Alden | Bloomberg Creative Photos | Getty ImagesIn 2016, the U. 's vote to leave the EU mpted many es to shift operations to the European continent, taking investment and headcount with them
Fast forward to 2025, and the specter of U (this bears monitoring)
At the same time, President Donald Trump's 30% trade tariffs on the EU, which will kick in on Aug, amid market uncertainty
Nevertheless, At the same time, 1 unless a trade deal is reached, could bring them back
Could be a big indirect winner" if the threatened U, considering recent developments
Moreover, Duties on the EU become a reality, according to Alex Altmann, partner and head of the German desk at London-based accountancy and advisory firm Lubbock Fine (noteworthy indeed). "If the tariff rate for the EU finally ends up anywhere near this 30% level then the U
Furthermore, 's much lower U
Tariffs would offer a major incentive for EU companies to shift some of their manufacturing to the U
At the same time, Or to expand their existing U
Furthermore, Facilities," he noted in ed s, given current economic conditions
Conversely, A Range Rover Sport SUV on the duction line at car manufacturing plant in Solihull, U, given current economic conditions
Chris Ratcliffe | Bloomberg | Getty Images"The U
Has a lot of spare manufacturing capacity after Brexit
And EU tariffs would be a major opportunity for the U, amid market uncertainty
To regain some of its lost as a key European manufacturing hub," added Altmann, who is also the vice president of the British Chamber of Commerce in Germany (something worth watching)
Additionally, As things stand, the U
Has already struck a trade deal with the U
That reduces duties on cars to 10% and grants it the lowest duty on steel imports
London also has a "reset" deal with the EU, after the Labour government under Prime Minister Keir Starmer — who was opposed to Brexit — carved out a trade agreement ing years of post-referendum acrimony (something worth watching), in this volatile climate
The post-Brexit trade landscapeThe sweet spot the U
Now finds itself in comes after several years of uncertainty and angst for es, as they've tried to navigate a post-Brexit world of more red tape and barriers to export
That's been an gripe for exporters, given that the 27-country EU remained the U
On the other hand, 's largest trading partner after Brexit was finally enacted in 2020
Additionally, The EU accounted for more than 50% of Britain's foreign trade in goods in 2024, according to the European Commission
Read moreTrump’s 50% steel tariffs hit the world but UK spared full blowTrump says U
Has struck ‘comprehensive’ deal with UKUK and European Union agree to post-Brexit reset dealA number of big es, and particularly financial services firms such as Goldman Sachs and JPMorgan, sought to avoid the transnational regulatory complexities of the post-Brexit landscape by relocating operations and assets to other financial hubs in the EU, such as Dublin, Paris, Amsterdam and Frankfurt
However, The exodus was ultimately not as dramatic as was initially feared, considering recent developments
Watch now0:0000:00Banks are moving jobs out of London because of Brexit - but not as many as you’d thinkInternational Digital OriginalsSupporters and critics argue over the merits and disadvantages of Brexit and the divorce from the EU's single market and customs union, as well as the free movement of goods and people that came with EU membership
Yet most economists agree that Brexit dented U
Furthermore, Exports, jobs and economic growth
The Office for Budget Responsibility, the U. 's independent forecaster, estimates that exports and imports will be around 15% lower in the long run, compared to if the U (fascinating analysis)
Had remained in the EU
Moreover, Although economists argue over the impact on the wider economy, it's generally agreed that the U, amid market uncertainty. 's GDP is around 5% lower than it would have been, had Britain not voted to leave the bloc
On the other hand, Not so fastWhile the U, in today's market environment
On the other hand, On the other hand, Is reveling in its newfound harmony with its American and European partners, the extent of any windfall that comes as a result of the EU's trading pain with the U, in this volatile climate
It remains un whether Trump's planned 30% tariff on the bloc will actually go ahead on Aug
President's mercurial nature means the ultimate levy rate could go higher — he previously threatened a 50% tariff — or lower, toward the baseline 10% level that the EU is pursuing, considering recent developments
Not everyone agrees that the U
Could benefit from trade misfortunes that befall the EU, whatever the outcome of last-ditch talks between Brussels and Washington. "First of all, the 30% tariffs for the EU, they're not a given," Carsten Nickel, managing director at Teneo, told CNBC last week, pointing out that any potential post-tariffs shift in investment from Europe back to the U
In contrast, Would be unly to happen quickly
Moreover, President Donald Trump attends a bilateral meeting with European Commission President Ursula von der Leyen during the 50th World Economic Forum (WEF) annual meeting in Davos, Switzerland, January 21, 2020
Nevertheless, Jonathan Ernst | Reuters"If we were to talk moving duction facilities from Europe to the U (noteworthy indeed)
Because the U (an important development)
In contrast, Has a deal with the U. — the time horizon for that is a multi-year, if not decade-long, kind of time horizon," he said
In addition, Nickel noted that the U, in today's market environment
Furthermore, 's strength remained in financial services rather than in manufacturing, which remains more prevalent in export-oriented countries Germany and Italy. "The reality is that the U. 's comparative advantage is not in high-end manufacturing, considering recent developments
So the idea that you're going with this stuff that you're currently ducing in, say, Germany and Switzerland, and you're moving that to the U
Additionally, Nevertheless, It's just not a decision that that a leader in Europe can take just that," Nickel said.
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