U.K. Chancellor of the Exchequer Rachel Reeves said the British government wants to boost commerce with the U.S., its biggest single-country trading partner, even as President Donald Trump threatens widespread trade tariffs.

“Last time that President Trump was in the White House, trade and investment between our two countries increased,” Reeves said in an exclusive interview with Bloomberg News at the Group of 20 meeting of finance ministers and central bank governors in Cape Town. “I have every confidence that can happen again.”

Reeves’ comments come ahead of a crunch meeting between Prime Minister Keir Starmer and Trump in Washington on February 27, where the pair are set to discuss a range of issues including trade and the invasion of Ukraine. The U.K. is desperate to avoid American tariffs, with Trump already having put 10% levies on imports from China, and set to impose tariffs on steel and aluminum from March.

Britain has said it held “very positive conversations” with the U.S. on trade in recent days, and has consistently argued that the U.S. does not have a notable trade deficit in goods with Britain, which therefore shouldn’t be a target for Trump’s tariffs. Total trade in goods and services between the countries was worth £294 billion ($373 billion) in 2024, according to U.K. government data.

Read More: EU Pushes Back Against Claim it Was ‘Formed to Screw’ U.S.

The stakes for the British economy were underlined in a speech February 26 by Bank of England (BOE) policymaker Swati Dhingra, who said global shocks had contributed as much as domestic factors to changes in U.K. growth in the last 15 years.

With large economies such as the EU looking to negotiate with the U.S., world trade appears to be heading for an “orderly fragmentation, possibly of a milder form than one with very punitive countermeasures,” she said. That would require little of the BOE, with trade diversion away from the U.S., and heightened uncertainty offsetting upward pressures on inflation from a stronger dollar and higher import costs. However, more disruptive scenarios can’t be ruled out. 

“Assessing the need for monetary policy action would require careful evaluation of the nature of the fragmentation shocks, their sectoral impacts and the time horizon over which they would be expected to unwind,” she said.

Ahead of Starmer visiting the U.S. and in response to pressure from Trump, the prime minister has announced an increase in Britain’s spending on defense to 2.5% of GDP by 2027, rising to 3% over the next decade. Reeves said the uplift was necessary for U.K. national security, and also that a peace deal to end the Ukraine-Russia conflict would have the potential to boost the global economy, but only if such an agreement was stable and enduring.

“Russia’s illegal invasion of Ukraine has placed a heavy burden on the global economy, with higher energy prices, higher food prices and disruption to global trade,” she said. “It is essential it’s a just and a durable peace if we are to get the benefits both for Ukraine and indeed the global economy.”

Reeves is currently facing fragility in Britain’s public finances, with some forecasters expecting her to miss her self-imposed fiscal rules when she provides an economic update to Parliament on March 26. Reeves said she’ll take “whatever action is necessary” to ensure her rules are met, raising the prospect of spending cuts or tax increases.

“The fiscal rules that I set out in the Budget in October that Parliament have endorsed are non-negotiable,” she said. “I am very clear that we need to go further and faster to grow our economy, and further and faster to improve and reform our public services, including improving productivity in public services.”

Public sector productivity has become an increasingly pressing issue for Reeves, particularly in the National Health Service. The NHS is almost 20% less productive than five years ago, according to the Office for National Statistics, and health spending has been identified by the Bank of England as a cause of weakness in Britain’s poor productivity figures. The head of NHS England, Amanda Pritchard, resigned as chief executive February 25, a sign of the government seeking to get to grips with the service.