The ‘tricky balancing act’ facing Starmer over US trade deal – and the real challenge to come

Published

3 months ago

May 10, 2025

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If you want a very visual representation of the challenges of transatlantic diplomacy in 2025, look no further than Oslo City Hall.

Its marbled mural-clad walls played home to a European military summit on Friday.

In December – as it does every year – it will host the Nobel Peace Prize ceremony. It’s an award Donald Trump has said he deserves to win.

But while the leaders gathering in the Norwegian capital may not say it publicly, they all have a very different perspective to the US president on how to win the peace – particularly when it comes to Ukraine.

So far, Sir Keir Starmer has managed to paper over these foreign policy gaps between the US and Europe with warm words and niceties.

But squaring the two sides off on trade may be more difficult.

The US-UK deal announced on Thursday contained no obvious red flags that could scupper deeper trade links with the EU.

However, that’s in part because it was more a reaction and remedy to Mr Trump’s tariff regime than a proactive attempt to meld the two countries together.

Laced with party-political venom, yes, but the Tory leader Kemi Badenoch is getting at something when she says this agreement is “not even a trade deal, it’s a tariff deal and we are in a worse position now than we were six weeks ago”.

There may be more to come though.

The government will talk up the possible benefits, but there are risks too.

Take the Digital Services Tax – much hated by the Trump White House as an unfair levy on US tech firms.

Despite the apparent pitch-rolling from the government, that was left untouched this week.

But asked to rule out changes in the future, the prime minister was non-committal, simply saying the current deal “doesn’t cover that”.

For trade expert David Henig, the potential flashpoints in the transatlantic Venn diagram Downing Street is trying to draw around food standards, digital regulation and services.

“It is a tricky balancing act, at this stage it looks like the UK will go more with the EU on goods regulations, but perhaps a little bit more with the US on services regulations,” he said.

For veterans of the post-2016 Brexit battles, this may all sound like Labour embracing the Boris Johnson-era mantra of “cakeism” – or trying to have it both ways.

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It’s ironic indeed, given Sir Keir is a politician who supported the Remain campaign and then called for a second referendum.

But what matters now is what works – not for Downing Street but for the swathes of voters who have abandoned Labour since they took office.

That’s why the prime minister was once again trying to humanise this week’s trade deals.

These are agreements, he said, that would be measured in the “many thousands of jobs” they would safeguard across the country.

That’s the real challenge now, taking the work done in the marbled halls of the world’s capitals and convincing people at home why it matters to them.

Politics

Fed governor tells bankers DeFi is ‘nothing to be afraid of’

Published

3 hours ago

August 21, 2025

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Fed governor tells bankers DeFi is ‘nothing to be afraid of’

Federal Reserve Governor Christopher Waller urged policymakers and bankers to stop fearing DeFi and stablecoins, saying they will drive the next wave of innovation in the US payments system.

Politics

Two Labour-run councils ‘considering all options’ to challenge migrant hotel use

Published

4 hours ago

August 21, 2025

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Two Labour-run councils 'considering all options' to challenge migrant hotel use

Two Labour-run councils are considering legal action to stop the use of hotels to house migrants in their areas after Epping council won a temporary injunction.

The leaders of Wirral and Tamworth councils both say they are considering their legal options in the wake of the Epping case, citing similar concerns about the impact of the hotels on their local communities.

Politics latest: Judge in Epping hotel case was Tory candidate four times

Epping Forest District Council won an interim High Court injunction on Tuesday to stop migrants being housed at The Bell Hotel, after arguing its owners did not have planning permission to do so.

Paula Basnett, the Labour leader of Wirral council, said: “We are actively considering all options available to us to ensure that any use of hotels or other premises in Wirral is lawful and does not ride roughshod over planning regulations or the wishes of our communities.”

She added: “If necessary, we will not hesitate to challenge such decisions in order to protect both residents and those seeking refuge.”

Carol Dean, the Labour leader of Tamworth Borough Council, said she understands the “strong feelings” of residents about the use of a local hotel to house asylum seekers.

She pointed out that under the Labour government, the use of hotels has halved from 402 to 210, with the aim of stopping the use of any hotels by 2029.

But in light of the Epping case, she said “we are closely monitoring developments and reviewing our legal position”.

Badenoch backs more council rebellions

Other Tory councils are also being encouraged to follow Epping’s lead by party leader Kemi Badenoch.

She has sent a letter to all the councils they control, pledging her support for them to fight migrant hotels.

She wrote: “The Epping hotel injunction is a victory for local people led by a good Conservative council working hard for their community. This is the difference Conservatives in local government deliver. Real plans. Real action.”

Conservative-run Broxbourne Council has announced it is exploring its legal options.

The Reform UK leader of Kent County Council has also said she was writing to fellow leaders in Kent to explore whether they could potentially take legal action.

Government under pressure

The prospect of more rulings in favour of councils will leave ministers asking where else they might be able to house asylum seekers. Other options may include flats and ex-army bases.

The prime minister and the home secretary are under huge pressure to clear the asylum backlog and stop using hotels across the country to house those waiting for their applications to be processed.

Protests have sprung up at migrant hotels across the country. But The Bell Hotel in Epping became a focal point in recent weeks after an asylum seeker housed there was charged with sexually assaulting a 14-year-old girl.

The council sought an interim High Court injunction to stop migrants from being accommodated at the hotel, owned by Somani Hotels Limited, on the basis that using it for that purpose contravened local planning regulations.

The interim injunction demanded that the hotel be cleared of its occupants within 14 days, but in his ruling on Tuesday, Mr Justice Eyre granted the temporary block, while extending the time limit by which it must stop housing asylum seekers to 12 September.

Somani Hotels said it intended to appeal the decision. Its barrister, Piers Riley-Smith, argued it would set a precedent that could affect “the wider strategy” of housing asylum seekers in hotels.

Epping hotel ‘sidestepped public scrutiny’

A government attempt to delay the application was rejected by the High Court judge. Home Office barristers had argued the case had a “substantial impact” on the government performing its legal duties to asylum seekers.

But Mr Justice Eyre dismissed the Home Office’s bid, stating that the department’s involvement was “not necessary”.

The judge said the hotel’s owners “sidestepped the public scrutiny and explanation which would otherwise have taken place if an application for planning permission or for a certificate of lawful use had been made”.

Reacting to Tuesday’s judgment, border security minister Dame Angela Eagle said the government will “continue working with local authorities and communities to address legitimate concerns”.

She added: “Our work continues to close all asylum hotels by the end of this parliament.”