The UK is drawing up plans to give ministers an EU-inspired "trade bazooka", allowing them to impose extensive sanctions to counter "economic coercion".
Trade Secretary Peter Kyle is preparing to give minister the wide-ranging powers to retaliate against any potential "adverse economic pressure" from other countries such as the US or China.
The Times reports the plan takes inspiration from the European Union's anti-coercion instrument, nicknamed the trade bazooka, which first came into force three years ago and allows the EU to impose sanctions such as excluding the aggressor’s companies from the EU market, introducing additional export controls or ending certain protections.
The Department for Business and Trade said action would not be restricted to the same area of the economy that is being targeted.
Any retaliatory measures taken would have the goal of "resolving the situation swiftly and effectively”.
It comes as US President Donald Trump threatened to rewrite the US-UK trade deal as he voiced his displeasure at a perceived lack of support from the UK government in the Middle East conflict.
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