British exporters are facing a £6billion blow after President Donald Trump imposed a new 10 per cent tariff linked to Greenland.

Manufacturers of vehicles, pharmaceuticals and industrial equipment are expected to be among the hardest hit, with economists warning the escalation could raise the risk of a UK recession.

European allies released a joint statement on Sunday afternoon stating that “tariff threats undermine transatlantic relations and risk a dangerous downward spiral.”

The levy was announced as part of Mr Trump’s campaign to pressure Denmark into selling Greenland to the United States.

The move threatens to unravel gains secured through the UK‑US trade agreement agreed last year.