British Finance Minister Rachel Reeves on Wednesday called for an immediate de-escalation of the war in the Middle East and sharply criticized the US administration’s handling of it.
Speaking to CNBC Sarah Eisen At the Invest In America forum in Washington, DC, Reeves warned of growing risks to global economic stability caused by the closure of the Strait of Hormuz.
The British chancellor slammed the Trump administration’s handling of the conflict, saying the war’s objectives were “unclear” and oscillated between regime change, protecting partners in the region and stopping Tehran’s nuclear program.
“I’m not convinced that this conflict has made the world safer,” Reeves said. “Over the past six weeks, the exact objective of this conflict has not been clearly established.”
She said the UK still had a “very good relationship” with the US, but added: “We don’t always have to agree on everything.”
She said oil and gas facilities in the Middle East had suffered a lot of long-term damage. “Even if this conflict ends tomorrow, it will have longer-term consequences,” she added. “The damage is done.”
On Wednesday, the IMF said the UK – which is a net importer of gas – will see the most heavily hit growth of any of the world’s richest economies as a result of the Iran war.
Reeves, who is in Washington to attend the spring meeting of the IMF and World Bank, said he is confident the UK can beat those forecasts. She said UK growth would be higher and inflation lower if this conflict ended, “and that can only happen through de-escalation”.
“The best economic policy, not just for the UK but globally, is de-escalation and reopening of the Strait of Hormuz,” she said, reiterating “loudly” her call for a return to the diplomatic negotiations that took place before the start of hostilities.
