The current uncertainty about the future of British Steel is just the latest manifestation of the multiple and multi-faceted issues now confronting nations, sectors and businesses as each of us tries to work out the likely impacts of President Trump’s imposition of tariffs on the global economy and on the businesses in which all of us work.
None of us can confidently suppose this period of uncertainty will swiftly be resolved through bilateral negotiations between the US and its trading partners. There may be a reduction in bilateral country tariff rates in the future. But there may not. The effects on the global economy are still likely to be structural and long-lasting. The S&P 500 shed nearly USD 6 trillion after Trump’s announcement of tariffs a week ago (but has partially recovered since then). And the impact on company P&Ls and forecasts around the world is, at best, uncertain. By the time this article is published, the tariff position will have changed, probably twice.
The chilling effects of this uncertainty on commodity prices, as well as on the order books and contractual arrangements between producers and consumers of commodities such as aluminium and steel, and between contractors and their clients, risk translating into a general lack of confidence in and across the construction and engineering sectors – which are normally engines of vitality and growth in the global economy.
The 25% tariff rate on steel and aluminium imported into the US that kicked in last month and remains in force demonstrates the need for companies to take early and decisive action in relation to their order books and contractual relationships. Future project funding is likely to be a challenge, contracts will go over budget leaving client or contractor out of pocket and, as a consequence, the clock is already ticking until the moment when a surge of disputes between contractors, suppliers and their clients, and purchasers and manufacturers begins to make its presence keenly and cumulatively felt. We have an enviable record in cost escalation claims and clause drafting, together with bespoke contract strategies.
Those businesses that are best placed to weather the approaching storm are the ones that will have taken early expert advice, ensuring project funding is managed in a timely and effective way – and in a way that brings greater budgetary certainty and confidence.
At Diales, we pride ourselves in our ability to offer clients cost-effective and flexible solutions which, now more than ever, are crucial in helping leadership teams navigate the choppy waters which they, their businesses, their clients and counterparties are destined to be facing. In this period of truly unprecedented upheaval, it is hard to predict what will happen next. Having faced similar uncertainties and challenges during the Covid-19 pandemic, Diales is exceptionally well placed to assist: as an international consulting business spanning five continents, we have extensive and proven experience of providing specialist support to clients in the construction and engineering industries and helping them develop real-world solutions to their complex commercial dilemmas and budgetary uncertainties.
Whether your concerns stem from orders of raw materials which are about to become suddenly more costly, clients trying to renegotiate contract terms because of their spiralling supply chain costs, or unwelcome delays in the delivery of finished goods or raw materials, we’re here to help. We’ve been resolving issues just like yours for over 40 years and we’ll be happy to share some of our understanding and experience with you and your business.
Find your nearest point of contact by visiting contact us.
Sources
‘Donald Trump defies market tumult as tariffs take effect’, April 9 2025 - https://www.ft.com/content/81cbdcdf-aafa-411e-8458-4af2b2b186d0
‘The FTSE 100 businesses most exposed to Donald Trump’s tariffs’, April 8 2025 - https://www.thetimes.com/business-money/companies/article/the-ftse-100-businesses-most-exposed-to-donald-trumps-tariffs-n2bgd8c9q
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