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Taken at face value Donald Trump’s embrace of reciprocal tariffs is a declaration of total trade war, that would amount to perhaps the single biggest peacetime shock to global commerce.

In promising to levy import taxes on any nation that imposes tariffs or VAT on US exports, he is following through on a campaign promise to address a near trillion dollar trade deficit – the difference between the value of America’s exports and its imports – that he believes amounts to a tax on American jobs.

In response, he wants to deploy tariffs as an “external revenue service”, simultaneously easing the US deficit and, so the theory goes, pricing out imports in favour of domestic production.

Follow latest: Trump’s trading tariffs

With a promise to reestablish industries, from chip production lost to Taiwan, and car and pharmaceutical manufacturing to Europe, he is promising a country-by-country tailored assault on the status quo.

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Donald Trump unveils new tariffs for trading partners

Risk to Britain remains uncertain

His primary targets appear to be the major trading partners with whom the trading deficit is greatest.

Mexico and Canada, the European Union (whose 10% tariff on US cars is a particular irritation), as well as the ‘BRICS’ nations – Brazil, Russia, India (which imposes 9% tariffs on US imports), China and South Africa.

What it means for the UK will not be certain until the details are revealed in April, but it is a blow to the emerging view in Whitehall that Britain might wriggle through the chaos relatively unscathed.

To begin with, the US runs a trade surplus with the UK – in a quirk of statistics, the UK thinks it has a surplus too – and Brexit has placed it outside the EU bloc with the ability at least in theory to be more agile.

The UK also imposes direct tariffs on very few US goods following a deal in 2021, brokered by then trade secretary Liz Truss, that removed tariffs on denim and motorcycles bound for Britain, and cashmere and Scotch whisky heading the other way.

But we do add VAT to imports, and Mr Trump’s threat to treat the sales tax as a tariff by another name will chill British exporters.

Read more from Sky News:
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President Donald Trump listens as he meets with India's Prime Minister Narendra Modi in the Oval Office of the White House, Thursday, Feb. 13, 2025, in Washington. (Photo/Alex Brandon)
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Donald Trump accepts his tariffs will be inflationary for the US. Pic: AP

Tariffs set to raise prices in US

Analysts have estimated tariffs could add 21% to the cost of exports, amounting to a £24bn blow to national income.

Pharmaceuticals, cars, chemicals, scientific instruments and the aerospace industry – the main components of our £182bn US export trade – will all be potentially affected.

But the pain will certainly be shared.

Tariffs are paid by the importer, not the exporter, and even Mr Trump accepts they will be inflationary.

Rising prices on Main Street could yet be the biggest brake on the president’s tariff plan.

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Trump hints Ukraine election may be needed for peace – as he addresses Kyiv being left out of Russia talks

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Trump hints Ukraine election may be needed for peace - as he addresses Kyiv being left out of Russia talks

Donald Trump has suggested Russia’s war in Ukraine could have been “settled very easily” as he criticised Kyiv’s negotiation skills.

In comments after an extraordinary meeting between senior American and Russian officials on Tuesday morning in Saudi Arabia, the US president said of Ukraine: “They’ve had a seat [at the table] for three years and a long time before that.

“This could have been settled very easily. Just a half-baked negotiator could have settled this years ago without, I think, the loss of much land and without the loss of any lives and without the loss of cities that are just laying on their side.”

While touting his own negotiation skills, Mr Trump also said he was “more confident” about a peace deal after Tuesday’s talks, attended by US secretary of state Marco Rubio.

Follow live: Lavrov tells US that NATO troops in Ukraine is ‘unacceptable’

While speaking from Mar-a-Lago in Florida, Mr Trump also said he would not oppose seeing European peacekeeping troops stationed in Ukraine as part of a peace deal with Russia.

He also repeated a proposal that Ukrainian leader Volodymyr Zelenskyy hold elections in Ukraine as a condition of peace.

‘Not a Russian thing’

“We have a situation where we haven’t had elections in Ukraine, where we have martial law, essentially martial law in Ukraine, where the leader in Ukraine, I mean, I hate to say it, but he’s down to 4% approval rating.”

He added: “If Ukraine wants a seat at the table, wouldn’t the people have to say – it has been a long time since they had an election?

“That’s not a Russian thing, that’s something coming from me and coming from many other countries also.”

Mr Trump also told reporters he and Russian leader Vladimir Putin had discussed Ukraine before the full-scale invasion in 2022.

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“President Putin and I would talk about Ukraine, and it was the apple of his eye, I will tell you that,” he said.

“But he never, there was never a chance of him going in. And I told him: ‘You better not go in, don’t go in, don’t go in.’ And he understood that and he understood it fully.”

From Trump to Zelenskyy – it was goodbye

In another place, at another time, it would have been: “You’re fired.”

Donald Trump coined it differently when he was asked about Volodymyr Zelenskyy, but the sentiment was the same.

Asked about suggestions that Russia wanted elections in Ukraine as part of a peace deal, the US president replied: “I hate to say it, but he’s down to a 4% approval… when they want a seat at the table, wouldn’t the people of Ukraine say it’s been a long time since we had an election? That’s not a Russia thing, that’s coming from me and other countries.”

From one president to another, it was goodbye. A farewell to the notion that Trump respects Zelenskyy as an equal player in peace negotiations.

Read James Matthews’s full analysis here

US and Russia ‘need vibrant diplomatic missions’

Mr Trump added he will probably meet with Mr Putin before the end of the month.

At Tuesday morning’s talks, US and Russian officials agreed to restore embassy staffing and establish a high-level team to negotiate peace in Ukraine in another sign of the significant American change in diplomatic relations with Moscow.

Mr Rubio said the two countries “need to have vibrant diplomatic missions that are able to function normally”. The US and Russia also agreed to explore closer relations and economic cooperation at the meeting.

“Should this conflict come to an acceptable end, the incredible opportunities that exist to partner with the Russians geopolitically on issues of common interest and frankly, economically, on issues that hopefully will be good for the world and also improve our relations in the long term,” Mr Rubio said.

Read more from Sky News:
Trump’s ‘diplomacy’ does not look good for Ukraine – analysis
Starmer wants US ‘backstop’ to deter Russia
Who is attending Russia and US peace talks?

He added ending Russia’s war in Ukraine would require concessions from all sides.

The comments came as talks between Russian and US officials in Saudi Arabia ended – part of a remarkable US policy reversal after years of former president Joe Biden leading international efforts to isolate Moscow.

‘Very useful’ talks, Lavrov says

Speaking to reporters after the meeting, Russian foreign minister Sergei Lavrov said “the conversation was very useful”.

“We not only listened, but also heard each other,” Mr Lavrov said.

“And I have reason to believe that the American side has started to better understand our position, which we have once again outlined in detail, using specific examples, based on President Putin’s repeated speeches.”

US State Department spokesperson Tammy Bruce said even though Ukraine was not at the table on Tuesday, any actual peace negotiations will include the country.

Meanwhile, President Volodymyr Zelenskyy said his country will not accept any outcome from this week’s talks if Kyiv does not take part. No Ukrainian officials were present at the meeting.

U.S. Secretary of State Marco Rubio meets with Saudi Foreign Minister Prince Faisal bin Farhan Al Saud, Saudi National Security Advisor Mosaad bin Mohammad Al-Aiban, U.S. National Security Advisor Mike Waltz, U.S. Middle East envoy Steve Witkoff, Russian Foreign Minister Sergei Lavrov and Russian President Vladimir Putin's foreign policy advisor Yuri Ushakov, at Diriyah Palace, in Riyadh, Saudi Arabia.
Pic: Reuters
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Inside Tuesday’s talks in Saudi Arabia. Pic: Reuters

Ukraine losing ground to Russia

The talks came as Ukraine is slowly but steadily losing ground against more numerous Russian troops in a grinding war that began nearly three years ago.

The Ukrainian air force said Russian troops launched a barrage of 176 drones at Ukraine on Monday night, most of which were destroyed or disabled by jamming.

One Russian drone struck a residential building in Dolynska in the Kirovohrad region, wounding a mother and her two children and prompting an evacuation of 38 apartments, the regional administration reported.

Four more residential buildings were damaged by drone debris in the Cherkasy region of Ukraine, according to local officials.

European allies left scrambling

Ties between Russia and the US had fallen to their lowest level in decades in recent years – a rift that had been widening since Russia annexed Crimea from Ukraine in 2014 and worsened after Moscow’s full-scale invasion in 2022.

At that point, the US, along with European nations, imposed a raft of sanctions on Russia and the allies have repeatedly expanded the measures to damage the Russian economy.

But the recent US diplomatic blitz on the war has sent Mr Zelenskyy and key European allies scrambling to ensure a seat at the table amid concerns that Washington and Moscow could press ahead with a deal that will not be favourable to Ukraine.

On Monday, France called an emergency meeting of European nations, including the UK, to discuss the war.

Saudi Arabia seeks to be diplomatic player

The meeting between the US and Russia on Tuesday at the Diriyah Palace in the Saudi capital of Riyadh also highlights de facto leader Crown Prince Mohammed bin Salman’s efforts to be a major diplomatic player, burnishing a reputation severely tarnished by the 2018 killing of Washington Post journalist Jamal Khashoggi.

Saudi state media described the talks as happening at the prince’s direction. Saudi Arabia has also helped in prisoner negotiations and hosted Mr Zelenskyy for an Arab League summit in 2023.

Mr Zelenskyy had been due to travel to Saudi Arabia this week but rescheduled it to 10 March, suggesting he wanted to avoid his visit being linked to the US-Russia talks since Ukrainian officials were not invited.

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Donald Trump’s direction of travel in diplomacy does not look good for Ukraine

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Donald Trump's direction of travel in diplomacy does not look good for Ukraine

That the United States chose to hold talks with Russia about Ukraine without Ukraine sums up the power imbalance that is upending security assumptions for the whole of Europe.

Volodymyr Zelenskyy, the Ukrainian president, has consistently warned that Kyiv must have a seat at the negotiating table for any discussions about ending Vladimir Putin‘s war to have a chance of success. His European allies also want to have a voice.

Yet these requests were ignored by Donald Trump and his strongman approach to diplomacy, with the president instead dispatching his top diplomat and two other senior envoys to meet Russian counterparts in Saudi Arabia on Tuesday.

Steve Witkoff, Marco Rubio and Mike Waltz.
Pic: Reuters
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(L-R) The US delegation in Riyadh included Steve Witkoff, Marco Rubio and Mike Waltz. Pic: Reuters

Ukraine war latest: Trump says he’s ‘more confident’ of peace deal

Mr Zelenskyy, apparently by chance, had been due to embark on a pre-planned trip to the kingdom later that same day.

However, he decided to delay the visit to avoid the appearance of giving any kind of legitimacy to the bilateral encounter between Moscow and Washington.

Unfortunately for Kyiv, beyond noisy protest, it has very limited options when it comes to channelling the disruptive force of the Trump White House in its favour.

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The Ukrainian military remains hugely reliant on US weapons to fight Russia’s invasion and Mr Zelenskyy has made clear he would want an American element in any international security force that might be agreed upon to monitor a ceasefire – even though this is a role the US appears reluctant to fill and the Kremlin has said would be “unacceptable”.

It means Mr Trump has significant leverage over his Ukrainian counterpart which he will surely use to try to force through negotiations even on terms less favourable to Kyiv.

Read more:
Analysis – Russia tries to appeal to Trump’s business background

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Ukrainians react to US-Russia talks

The US has already reportedly tried to make Ukraine sign away a large portion of its natural resources to pay for US support – an uncomfortable offer that Mr Zelenskyy has so far declined but an indication of the new transactional approach to US foreign policy.

Mr Trump has repeatedly vowed to end Russia’s war in Ukraine – even claiming during the US election campaign that he would do this within 24 hours.

But he never spelled out how.

The past week, however, has offered an indication of the direction of travel and it does not look good for Ukraine.

From unilaterally picking up the phone to Vladimir Putin to sanctioning such a high-level meeting with the Russians in Riyadh, the only currency that seems to matter to the White House is power and right now both Kyiv and its European partners are looking all too weak.

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US and Russia agree to restore embassy staffing and establish Ukraine peace negotiation team

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Trump hints Ukraine election may be needed for peace - as he addresses Kyiv being left out of Russia talks

US and Russian officials have agreed to restore embassy staffing and establish a high-level team to negotiate peace in Ukraine – another sign of the significant American change in diplomatic relations with Moscow. 

Marco Rubio, the US secretary of state, said the two countries “need to have vibrant diplomatic missions that are able to function normally”. The US and Russia also agreed to explore closer relations and economic cooperation at the meeting.

“Should this conflict come to an acceptable end, the incredible opportunities that exist to partner with the Russians geopolitically on issues of common interest and frankly, economically, on issues that hopefully will be good for the world and also improve our relations in the long term,” Mr Rubio said.

He added ending Russia’s war in Ukraine would require concessions from all sides.

Follow live: Lavrov tells US that NATO troops in Ukraine is ‘unacceptable’

The comments came as talks between Russian and US officials in Saudi Arabia ended – part of a remarkable US policy reversal after years of President Joe Biden leading international efforts to isolate Moscow.

No date has yet to be set for a meeting between Vladimir Putin and Donald Trump but it is “unlikely” to take place next week, Mr Putin’s foreign affairs adviser Yuri Ushakov said.

More on Donald Trump

Speaking to reporters after the meeting, Russian foreign minister Sergei Lavrov said “the conversation was very useful”.

“We not only listened, but also heard each other,” Mr Lavrov said.

“And I have reason to believe that the American side has started to better understand our position, which we have once again outlined in detail, using specific examples, based on President Putin’s repeated speeches.”

US state department spokesperson Tammy Bruce has said even though Ukraine was not at the table on Tuesday, any actual peace negotiations will include the country.

Meanwhile, President Volodymyr Zelenskyy said his country will not accept any outcome from this week’s talks if Kyiv does not take part. No Ukrainian officials were present at the meeting.

Ukraine losing ground to Russia

The talks came as Ukraine is slowly but steadily losing ground against more numerous Russian troops in a grinding war that began nearly three years ago.

The Ukrainian air force said Russian troops launched a barrage of 176 drones at Ukraine overnight, most of which were destroyed or disabled by jamming.

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One Russian drone struck a residential building in Dolynska in the Kirovohrad region, wounding a mother and her two children and prompting an evacuation of 38 apartments, the regional administration reported.

Four more residential buildings were damaged by drone debris in the Cherkasy region of Ukraine, according to local officials.

European allies left scrambling

Ties between Russia and the US had fallen to their lowest level in decades in recent years – a rift that had been widening since Russia annexed Crimea from Ukraine in 2014 and worsened after Moscow’s full-scale invasion in 2022.

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Expansion of NATO a ‘direct threat’ to Russia

Read more from Sky News:
Starmer wants US ‘backstop’ to deter Russia
Who is attending Russia and US peace talks?

At that point, the US, along with European nations, imposed a raft of sanctions on Russia and the allies have repeatedly expanded the measures to damage the Russian economy.

But the recent US diplomatic blitz on the war has sent Mr Zelenskyy and key European allies scrambling to ensure a seat at the table amid concerns that Washington and Moscow could press ahead with a deal that will not be favourable to Ukraine.

On Monday, France called an emergency meeting of European Union countries and the UK to discuss the war.

Saudi Arabia seeks to be diplomatic player

The meeting between the US and Russia on Tuesday at the Diriyah Palace in the Saudi capital of Riyadh also highlights de facto leader Crown Prince Mohammed bin Salman’s efforts to be a major diplomatic player, burnishing a reputation severely tarnished by the 2018 killing of Washington Post journalist Jamal Khashoggi.

Saudi state media described the talks as happening at the prince’s direction. Saudi Arabia has also helped in prisoner negotiations and hosted Mr Zelenskyy for an Arab League summit in 2023.

Mr Zelenskyy had been due to travel to Saudi Arabia this week but rescheduled it to 10 March, suggesting he wanted to avoid his visit being linked to the US-Russia talks since Ukrainian officials were not invited.

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