Prime Minister Sir Keir Starmer has insisted that the UK will stand its ground in opposing any attempt by the US president to take control of Greenland — a stance that could trigger economic retaliation from what was once Britain’s closest ally.
President Donald Trump has warned that European countries backing Denmark’s claim to Greenland will face 10% tariffs, with duties set to rise to 25% later in the year.
Given that the US is one of the UK’s biggest trading partners and a key market for British tech firms looking to expand internationally, these threats raise serious concerns for businesses on both sides of the Atlantic.
While there is still time for events to unfold differently before the first tariffs are due to take effect in February, the current outlook leaves UK companies facing significant uncertainty. So, what might lie ahead?
A short-term sales lift before June
If both rounds of tariffs are implemented, American customers are likely to face higher prices for UK goods and services, leading to an eventual slowdown in demand.
Before that happens, however, a temporary surge in sales could emerge. Susannah Streeter, chief investment strategist at Wealth Club, expects a brief boost as US importers rush to secure deals ahead of the second tariff increase.
As businesses prepare for rising costs, Streeter suggests many international transactions will be pulled forward to beat the 25% levy expected in June. This could “deliver an initial lift” in sales, she said, before demand drops sharply as buyers are ultimately pushed to seek more affordable suppliers elsewhere over the longer term.
