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UK borrowing rises unexpectedly as Rachel Reeves claims ‘country’s finances are in order’ following Budget

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UK borrowing costs rose unexpectedly to £17.8billion in December, but Chancellor Rachel Reeves remains confident in the country’s financial health following the October budget.

This figure was around 25 per cent higher than what economists had predicted and was £10.1billion more than the same time last year, making it the highest borrowing in December for four years.


The unexpected rise puts pressure on Reeves to make tough decisions on budget cuts before the upcoming spending review in the summer.

The UK’s budget deficit was larger than expected in December, largely due to high debt interest costs and a one-off military housing purchase, according to new data released on Wednesday.

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Public sector net borrowing reached £17.8billion ($21.93billion) in December, the Office for National Statistics (ONS) reported. Economists had predicted borrowing would be around £14.1billion.

Reeves UK borrowing figures

The UK’s budget deficit was larger than expected in December

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The ONS said that a significant part of the borrowing came from an £8.3billion debt interest bill, which was the third-highest December total ever. Additionally, a £1.7billion payment for repurchasing military homes added to the overall borrowing.

Reeves acknowledged the headroom to meet those targets in the final year of the economic forecast is “tight” but added “those fiscal rules are important to us because they are the bedrock, the foundation of that stability that I’ve spoken about”.

Speaking at the World Economic Forum in Davos, she insisted the country’s finances “were now in order” following her October budget.

She said: “Now we have wiped the slate clean, my instinct is to have lower taxes, less regulation, make it easier for businesses to do business.”

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She defended her approach to the public finances with her two fiscal rules of paying for day-to-day spending through tax receipts and bringing debt down as a share of gross domestic product.

“We will continue to make decisions to ensure that we meet those fiscal rules,” she said.

UK government borrowing in the current financial year has reached £129.9bn, £8.9 billion higher than the same period last year and a record outside the pandemic’s peak.

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This borrowing is also £4bn above the £125.9 in forecast by the OBR. The increase follows volatility in the UK bond market, driving up borrowing costs and raising concerns about the Government’s ability to meet fiscal rules.

Higher bond yields, weaker growth, and rising inflation are expected to reduce the financial headroom, threatening fiscal stability.

The yield on UK 30-year bonds reached its highest level since 1998 before dropping back down when inflation data showed it had fallen to 2.5 per cent in December. The pound also dropped to a 14-month low of $1.22 in early January but has since risen slightly. This drop marked a sharp fall from the $1.34 level in September.

In response to the borrowing rise, Darren Jones, the Chief Secretary to the Treasury, said: “Economic stability is vital for our number one mission of delivering growth.

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“That’s why our fiscal rules are non-negotiable and why we will have an iron grip on public finances. Through our Spending Review, we will examine every line of government spending for the first time in 17 years, rooting out waste to ensure taxpayers’ money is spent wisely.”

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The next financial statement will be on March 26 and a budget in the autumn.

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The OBR will conclude whether the Government is set to miss its fiscal rules when it publishes its updated forecasts at the spring statement on March 26.

Jones said the Government will “interrogate every line of government spending for the first time in 17 years” to “root out waste to ensure every penny of taxpayers’ money is spent productively and helps deliver our plan for change”.

Elliott Jordan-Doak, a senior UK economist at Pantheon Macroeconomics, said the Government will have to take action to ensure it meets its fiscal rules.

He said: “We expect the Government to outline spending reductions – backloaded towards the end of the forecast year – at the next fiscal event in March. Further tax increases at the next Budget in October is also a good bet.”

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John Healey issues warning to Vladimir Putin after Russian spy vessel spotted in British waters

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Defence Secretary John Healey has issued a stark warning to Vladimir Putin after a Russian spy ship was detected operating near UK waters.

“We see you, we know what you are doing and we will not shy away from robust action to protect this country,” Healey told MPs.


Healey revealed the Russians have been using the ship for “gathering intelligence and mapping the UK’s critical underwater infrastructure”.

In November, the Yantar was detected “loitering over UK critical undersea infrastructure”, prompting a decisive response from British forces.

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Jonathan Healey

John Healey spoke to MPs in the House of Commons earlier today

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“I authorised a Royal Navy submarine, strictly as a deterrent measure, to surface close to the Yantar to make clear that we had been covertly monitoring its every move,” the Defence Secretary said.

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The submarine is believed to have been one of Britain’s Astute-class nuclear-powered attack boats.

Following the encounter, the Russian vessel departed UK waters and sailed towards the Mediterranean.

The Yantar has now returned to the North Sea, having entered the UK exclusive economic zone approximately 45 miles off the British coast on Monday.

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Royal Navy vessels HMS Somerset and HMS Tyne have been deployed to monitor the Russian ship’s movements.

The warships have been tracking the vessel’s every move through British waters for the past two days.

“The foreign ship Yantar is currently in the North Sea having passed through British waters,” Healey told MPs.

So far, the Defence Secretary noted that the Russian vessel has been complying with international rules of navigation.

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Yantar

So far, the Defence Secretary noted that the Russian vessel has been complying with international rules of navigation

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In response to the Yantar’s return, Healey has implemented new rules of engagement for Royal Navy vessels.

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The Defence Secretary confirmed he had amended the protocols to allow British warships to better understand the movement of the Russian vessel.

“I changed the Royal Navy’s rules of engagement so that our warships can get closer and better track the Yantar,” Healey told MPs.

He emphasised the vessel’s intelligence-gathering capabilities, saying: “Let me be clear, this is a Russian spy ship used for gathering intelligence and mapping the UK’s critical underwater infrastructure.”

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‘Accept responsibility!’ Ellie Costello grills Tory MP on ‘number of failings’

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GB News presenter Ellie Costello grilled Tory MP Matt Vickers over the Southport stabbings, highlighting multiple missed opportunities to prevent the tragedy.

“There were a number of failings, failings under your watch which you must be able to accept responsibility for”, Ellie fumed during the heated exchange.

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Daughter of Sir David Amess hits out at Prevent scheme following Rudakubana revelations: ‘They failed me!’

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The daughter of late MP Sir David Amess has revealed that she “begged and pleaded” for an inquiry into her father’s murder, as she highlighted the “failures” of the Home Office and the Prevent programme.

The Labour Government has announced an inquiry into the Southport attack of July 2024, after it was revealed that killer Axel Rudakubana, 18, was referred to the Government’s anti-extremism scheme Prevent three times, but no intervention was made.

FULL STORY HERE.

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Alison McGovern defends ‘important judgment’ in Southport killings

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A Labour minister has defended “important judgements” made about withholding information in the Southport killings case, after police claimed they were “gagged” by the Crown Prosecution Service.

Employment minister Alison McGovern said decisions around information disclosure were crucial to protect the possibility of a trial and achieving justice.

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The scandalous climate bill that will give Labour UNCHALLENGED power to pursue net zero that’s going under the radar

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The shocking details of a bill giving the government unprecedented power to pursue net zero and other eco-goals have been revealed.

The ‘Climate and Nature Bill’, which will have its second reading on Friday, will legally bind the UK government and the Secretary of State for Energy to achieving net zero and a slew of other green targets described by some as ‘national self-harm’.


The legislation, which is being led by Lib Dem MP Roz Savage, will give Labour legal cover to rigorously pursue climate targets.

Critics say it has the potential to erode personal freedoms under the guise of addressing climate crises and could devastate rural economies, enforce invasive carbon tracking and strip property rights from rural folk.

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The legislation states ‘the Secretary of State must achieve the following objectives’, which include reducing greenhouse gas emissions to net zero, taking responsibility for ‘offshored’ emissions via exports and imports, and preventing the world from warming by 1.5 degrees.

It also states the Secretary of State must ‘ensure the end of the exploration, extraction, export and import of fossil fuels by the United Kingdom as rapidly as possible,’ inviting concerns the UK may harm its energy security in pursuit of green credentials.

Other objectives include ‘fulfilling the Paris Climate agreement,’ ‘halting and reversing the degradation and loss of nature in the United Kingdom and overseas’ and ensuring ‘nature is visibly and measurably on the path of recovery.’

Critics have argued the government could use the bill as legal cover to seize farmers’ land for rewilding projects, harming the UK’s food security and destroying rural economies.

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Roz Savage

Roz Savage, Lib Dem MP and leader of the Climate and Nature Bill

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It could also provide legal cover for land requisitions for vast solar panel farms, scores of wind turbines and other green energy producing infrastructure across Britain’s countryside.

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Sceptics also highlight the potential skyrocketing of energy prices as the UK government is legally required to move away from fossil fuels to expensive green energy.

Hikes to energy prices, which have already happened under Labour, would tip many businesses and families struggling with the cost of living over the edge.

This could also make travel prohibitively expensive, something Labour have been accused of eyeing to encourage people into electric cars.

Critics have also warned how the legislation could weaken the UK internationally, making us dependent on foreign imports from countries like China.

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It comes after Donald Trump promised to scale up the US’s fossil fuels industry, telling the world America was going to ‘drill, baby, drill’, a move that has buoyed the energy industry in the US.

The bill has split opinion, receiving widespread support from MPs, faith leaders, businesses, seventeen union leaders and eco cheerleaders Dale Vince and Chris Packham.

GB News’ Bev Turner has taken a dim view of the legislation, however.

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The proposed legislation will also require itself to have a ‘positive impact’ on ‘local communities with a high deprivation’, ‘young people’ and ‘people with protected characteristics’ like religion, race, transgender status and age.

OBJECTIVES IN FULL

As laid out by Zero Hour, the campaign for the Climate and Nature Bill, the bill’s objectives include:

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  • Limit the UK’s total CO2 emissions to no more than its proportionate share of the IPCC’s remaining global carbon budget, for a 67% chance of limiting heating to 1.5°C.
  • Reduce CO2 emissions caused in the manufacture of the goods we import, in line with UK territorial emissions.
  • Reduce the UK’s emissions of methane and other greenhouse gases, at rates consistent with the last chance of limiting global heating to 1.5°C.
  • Ensure the end of the exploration, extraction, export and import of fossil fuels by the UK as rapidly as possible.
  • Ensure that steps taken to mitigate emissions minimise damage to ecosystems, food and water availability, and human health, as far as possible.
  • Restore and expand natural ecosystems, and enhance the management of cultivated ecosystems, to protect and enhance biodiversity.
  • Include the Mitigation and Conservation Hierarchy so that any development or activity that threatens nature uses this framework to prioritise the protection of nature.
  • Address the UK’s entire ecological footprint at home and overseas by accounting for and monitoring the impacts on human health and the destruction of nature; through the production and consumption of goods and services and all relate

The bill was supported by some big names when it was first introduced in March 2024 such as Caroline Lucas (former Green Party leader), Ed Davey (Liberal Democrat leader) and Colum Eastwood (Leader of the Social Democratic and Labour Party).

Roz Savage has been approached for comment.

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Suella Braverman doubles-down on Reform pact just days after refusing to rule out defection to Nigel Farage

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Ex-Home Secretary Suella Braverman has renewed calls for the Torries to “unify” with Reform UK in order to defeat Sir Keir Starmer’s Labour Party.

Braverman also called on her Conservative colleagues to mirror the tactics adopted by Republicans following Donald Trump’s emphatic 2024 US Presidential Election victory.


The Fareham & Waterlooville MP claimed that the Tories should look to adopt Trump’s brand of “unfiltered conservatism”, adding that she wants to make the “unsayable mainstream”.

Directly addressing the threat posed by her friend Nigel Farage, Badenoch told The Telegraph: “We do need to unite the Right. We need to come to some kind of accommodation.

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Rael Braverman, Suella Braverman and Nigel Farage

`Rael Braverman, Suella Braverman and Nigel Farage

RAEL BRAVERMAN

“I don’t know what the precise form looks like – whether that is a merger, whether that is a coalition, whether that is a supply and confidence agreement, whether that is a non-aggression pact.

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“I don’t know what it looks like.“In general, I am in favour of unifying the right.”

Braverman, who last week declined to rule out defecting to Reform UK, also highlighted that she agrees with Reform UK on its support for leaving the European Convention on Human Rights.

The 2022 Tory leadership hopeful was joined in Washington DC by her Reform-supporting husband Rael Braverman.

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The couple posed alongside Farage ahead of Trump’s inauguration on Monday.

Discussing Trump’s victory, Braverman said: “Donald Trump has not just shifted Overton window [a theory about what is politically acceptable], he’s shattered it.

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“He’s made the unsayable mainstream and he’s made the radical much more acceptable to the moderates.

“That is of an undeniable value to British Right-wing politicians. There are many things that we can adopt going forward to hopefully emulate his success in a few years time in the United Kingdom.”

Suella BravermanSuella Braverman PA

Braverman also slammed her Conservative colleagues for their attacks on Reform UK.

She claimed: “I’m not one of these Tories who is going to denigrate the Reform Party for running Nuremberg rallies [as] some of my colleagues did during the general election.

“I’m not going to turn my nose up at those who vote Reform as racists or nut jobs.

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“The people who are in Reform are largely conservatives who have lost patience with our party and that’s our fault.”

Kemi BadenochKemi BadenochPA

Despite Braverman extending an olive branch to Reform UK, Tory leader Kemi Badenoch and the populist party’s chairman Zia Yusuf dismissed calls for an alliance on the right.

Addressing the threat to the right of the Tories, Badenoch said: “Nigel Farage says he wants to destroy the Conservative Party. Why on earth would we merge with that?”

Yusuf also downplayed talks of a merger – comparing the populist party joining forces with the Tories to Netflix merging with Blockbuster.

However, the latest YouGov poll paints a difficult picture for the Tories.

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Labour retain top spot on 26 per cent, with Reform UK leapfrogging the Tories into second-place with 24 per cent of the vote.

Support for the Tories appears to have dropped slightly since the 2024 General Election, falling to as low as 22 per cent.

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‘Absolute transparency’ needed on Southport attack, Labour MP claims

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“Absolute transparency” is needed about the circumstances surrounding the attack in Southport by Axel Rudakubana, according to Employment Minister Alison McGovern.

She told GB News: “In relation to Southport, I hope you’ll understand if I first say that, like everybody in our country, my heart just breaks for the poor families of the three little girls and everybody who was injured or hurt in that dreadful attack.

“And we’ve seen another attack this morning that also is utterly heartbreaking.

“When it comes to the question that you asked there, we need to have transparency over all of the elements that have happened here.

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“I’m very, very concerned about some of the things that seem to have gone wrong in this case. That’s why it’s right that we have an inquiry to get the facts out in the open.

“That is the best way to get trust in the steps that we need to take forward to put right what is wrong, and to make sure, as a matter of course, there should be absolute transparency about what’s happened here.”

She added: “I know the police and Merseyside very well, and they are incredibly good and they will make their needs known following these terrible events to the government.

“As a general point, I’ve been a strong supporter of the Hillsborough Law, which following the terrible events and all that went wrong in covering up that terrible situation, we need to have a duty of candour to make sure that public servants who say what they know when terrible things happen, because that’s the public’s information and it should be out there.

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“I would say that anybody who’s worried about trust in government can show that they want change by voting and supporting Hillsborough law.”

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Sir David Amess’s daughter lets rip at REPEATED Prevent failures and shares her own devastating story

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The daughter of late MP Sir David Amess has revealed that she “begged and pleaded” for an inquiry into her father’s murder, as she highlighted the “failures” of the Home Office and the Prevent programme.

The Labour Government has announced an inquiry into the Southport attack of July 2024, after it was revealed that killer Axel Rudakubana, 18, was referred to the Government’s anti-extremism scheme Prevent three times, but no intervention was made.


Reflecting on her father’s murder in 2021 by Ali Harbi Ali, Amess told GB News that after he was also referred to the Prevent scheme, he was “let go” after being “taken for a coffee” by those running the programme.

Amess explained: “They took him out for a cup of coffee, he said he wasn’t a terrorist, and then they let him go back into the system. They were meant to have a subsequent meeting with him, and due to an admin error, it was never followed up on.

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Sir David Amess, Axel Rudakubana, Katie Amess

Katie Amess has revealed that she ‘begged’ the Home Office for an inquiry into her father’s murder, following the revelations about Southport killer Axel Rudakubana

Getty / CPS / GB News

“And then obviously, he went on to kill my father. And I’ve been calling for the resumption of the inquest, and I’ve not been allowed that. I was denied that.”

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Stressing how she “begged and pleaded” for an inquiry, Amess stated that the previous Government “shut her down”.

Amess added: “The Conservative Government totally shut me down. They wouldn’t let me do any kind of inquiry, wouldn’t take meetings with me, would ignore my letters. I begged, I pleaded. So then I tried the Labour Government.

“I haven’t heard from Yvette Cooper since they’ve announced that there will be a full inquiry into the Southport killings, but I was told absolutely no inquiry would be allowed because it would give away secret information that would be in the report.

Sir David Amess was among two MPs killed in recent yearsSir David Amess was among two MPs killed in recent yearsGETTY

“So I don’t understand what could be in my report that is not top secret, that would be in the Southport report.”

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Highlighting that the failings of Prevent are “not isolated incidents”, Amess expressed her concerns for other individuals being let back into society without intervention.

Amess stated: “This is not an isolated incident of Prevent failing, we have numerous cases of them letting the people back into the community and then go on to commit those atrocities.

“The answer can’t just be it was an admin error, that’s not acceptable.”

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Calling for changes to the Prevent scheme, Amess admitted that while she is glad the families of the Southport victims are being given an inquiry, there is still something “hugely wrong” with the system and how the scheme is run.

Katie Amess

Amess told GB News that she ‘expects to hear from Keir Starmer and Yvette Cooper’ regarding an inquest into her how Prevent ‘failed her’

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Calling for communication from the Labour Government, Amess concluded: “There’s got to be some more deeply involved, rigorous way of understanding or trying to understand what the person is thinking so that we can monitor them better, and then not just have an admin error and let them go back into the community.

“Something is hugely, hugely wrong with the system, and I’m so glad that the Southport victims’ families are going to be able to have an inquest.

“Keir Starmer said no stone will be unturned, it will be robust, we will get to the bottom of this – that is wonderful and that is the way that it should be for absolutely everybody that Prevent has failed.”

She added: “They can’t pick and choose and nitpick who they’re going to help and who they’re not going to help, so I fully expect to hear from Keir Starmer and Yvette Cooper to confirm that I will also be getting an inquiry into how Prevent failed me.”

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Keir Starmer’s Chagos deal threatening UK-US ‘special relationship’ as Donald Trump to give verdict in days

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A key aide for Donald Trump has warned the surrender of the Chagos Islands to Mauritius will jeopardise the “special relationship” between the UK and US.

The decision to cede the islands has been described as “haphazard” by former Department of Veterans Affairs Secretary Robert Wilkie.


It comes as Downing Street is hoping for a friendly start to the relationship between the new Trump regime and Sir Keir Starmer.

Wilkie, who is leading the current transition team within the Pentagon, told the BBC: “I think it was a calamitous decision, I don’t think there was much thought put into it.”

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Starmer has been warned by President Trump about the islands

Starmer has been warned by President Trump about the islands

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Wilkie added that President Trump considered the move to be “something that could impinge on that special relationship” between the two nations, and that the Diego Garcia military base, on the largest of the Islands, provides “leverage to project power”.

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A Foreign Office spokesman said: “Given Diego Garcia’s status as a key strategic asset, it is right to discuss the agreement with the new US administration.”

Meanwhile, Conservative former minister Sir Oliver Dowden asked Chancellor Rachel Reeves about how the Government would fund the proposed deal to give up control of the Chagos.

He said: “Does the Chancellor of the Exchequer propose to fund the reported £9 billion bill for the continued use of Diego Garcia to the Mauritians through higher taxes, through more borrowing or through spending cuts?”

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Trump has been sworn in as the 47th president of the United States

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Reeves replied: “We’re in discussions with the new administration in the United States around the future of Diego Garcia and will set out details in the spending review, as you’d expect.”

Foreign Secretary David Lammy said he was confident that the intelligence and military agencies in the US would persuade the new President it was a good agreement.

The UK plans to cede sovereignty of the British Indian Ocean Territory to Mauritius, leasing back the strategically important Diego Garcia base used by the US for 99 years at a reported annual cost of around £90million.

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It comes as possible challenges for the UK could be exacerbated if President Trump hikes tariffs to protect American businesses.

u200bThe islands in the Indian OceanThe islands in the Indian OceanGB News/Google

Business and Trade Secretary Jonathan Reynolds said: “We understand there is a genuine analysis in the US that feels that the very big trade deficit in goods that the US has both with the EU and with China, the sense of unfairness that is the root point of – we understand that, we might disagree, but we’ll engage with that.”

He said the US did not have the same trade deficit on manufactured goods with the UK that it does with the EU bloc and China, “so there’s the basis for a conversation” with Washington.

“But it will be a choppy time to be a trade minister, there’s no doubt about that, but our job is to navigate through that…You don’t get to pick the world as you want it to be. You get the world as it is.”

Downing Street has declined to comment on the President’s controversial first acts in office.

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The 10 countries that will be worst hit by Trump’s tariffs as shock graph shows surprising twist for Britain

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Donald Trump announced a flurry of executive orders on his first day in office, but for now, at least, he has held off slapping universal tariffs on all imports.

Financial markets breathed a sigh of relief, but he did tell reporters in the White House Oval Office that he’s considering introducing a 25 per cent tariff on all products imported into the US from Mexico and Canada as soon as February 1.


Make no mistake: economic pain is coming down the pike as Trump threatens a trade war with countries that run large deficits with Uncle Sam.

The deficit-to-surplus ratio is not the only determining factor – geopolitics will play a role in who will be hit hardest too – but generally, Trump subscribes to the mercantilist mindset of might is right when it comes to international trade, so he will look to maximise exports and minimise imports to shrink America’s trade deficit.

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GB News has ranked from highest to lowest in the countries that run the largest trade deficits with America and will therefore be slapped with the most punitive tariffs.

Who will be hit the hardest? 

China, Mexico and Vietnam top the list, running trade deficits of around $300billion, $156billion and $109billion respectively.

Trump has pledged to impose an additional 10 per cent tariff on all imports from China, adding to the already existing tariffs.

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This makes the total tariff on Chinese goods potentially as high as 60 per cent if all proposed tariffs are implemented.

The economic impact could be substantial, with previous studies indicating significant job losses and GDP reduction in China in response to similar tariff impositions.

The Chinese government has responded by asserting that no one wins in a trade war, hinting at potential retaliatory measures.

Donald Trump (left), chart showing trade deficits and surpluses with America

Donald Trump is expected to slap tariffs on its trading partners, with China, Mexico and Vietnam worst hit

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As Mexico’s economy is heavily integrated with that of the US, with approximately 83 per cent of its exports going across the border, the proposed 25 per cent tariff on all Mexican goods will significantly impact this trade relationship.

Analysts predict tariffs could plunge Mexico into a recession, depreciate its currency and drive up inflation.

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Vietnam, which has one of the largest (and rising) trade surpluses with the US, is also exposed.

The US trade deficit with Vietnam reached $102billion in the first ten months of 2024 alone, an almost a 20 per cent increase on the previous year.

Vietnam has capitalised on spiralling US-China trade tensions by becoming a manufacturing hub for companies leaving China. However, this could backfire if Trump imposes tariffs.

Canada also makes the top ten, with Trump signalling plans to impose a 25 per cent tariff on its neighbour as soon as February 1.

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Outgoing Prime Minister Justin Trudeau has emphasised Canada’s readiness to support American economic prosperity but cautioned against the imposition of tariffs, asserting Ottawa’s intent to retaliate if necessary.

Trudeau has alluded to the possible implementation of dollar-for-dollar matching tariffs in response to new US duties.

In order of highest to lowest, other countries running the largest trade deficits with America include:

  • Germany
  • Japan
  • Ireland
  • South Korea
  • Taiwan
  • India
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Justin Trudeau

Trudeau has alluded to the possible implementation of dollar-for-dollar matching tariffs in response to new US duties

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Which countries will be shielded from the worst impact? 

Netherlands, Hong Kong, and UAE run the largest trade surpluses with Uncle Sam, with surpluses of around $42billion, 23billion and 18billion respectively.

Trump will be less inclined to slap punitive tariffs on these countries as it could hurt American industries that benefit from these surpluses, such as aerospace, agriculture, and technology.

The UK will also be shielded from the worst as runs relatively large surplus with America.

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In 2023, the UK had a trade surplus of £71.4billion with the US in goods and services, which increased to £72.1billion in the 12 months ending June 2024.

However, with trade worth over £300billion flowing across the Atlantic every year, Trump’s mooted plan to slap universal tariffs of 10-20 per cent on all US imports would still have a seismic impact on the UK.

Everything from Scotch whisky, automotive products, and pharmaceuticals would face higher costs.

Analysts from various think tanks, like the National Institute of Economic and Social Research (NIESR), have estimated that Trump’s tariffs could halve UK economic growth, reducing it from an already low projected 1.2 per cent to about 0.4 per cent in the year following implementation.

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This is due to both increased costs for UK exporters and potential retaliatory measures from other countries.

The imposition of tariffs would likely increase inflation by pushing up the cost of imports, impacting consumer prices across various sectors. The Bank of England might then consider raising interest rates, which could further slow economic activity

This would put further pressure on Rachel Reeves, who is already struggling to tame rising borrowing costs and reverse sluggish growth.

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