The little-discussed trade agreement the United Kingdom has just completed with the United States. This accomplishment is a significant step toward proving worth to the new administration of Prime Minister Sir Keir Starmer. This agreement is the result of years of sometimes contentious negotiations, especially after former President Donald Trump threw the international trading system into disarray with his tariff blitz. The agreement specifically aims to remove tariffs on key UK exports. This is true for industries such as steel and cars that have faced steep tariffs in the US marketplace.
These tariffs President Trump enacted could soon be extended to virtually all goods the UK exports to the US. As it stands, these products face a 10% tariff. UK steel and aluminium exports have been hit with a monstrous 25% tariff. In addition to cars, car parts too have been impacted by this same punitive rate. Understanding the value of trade, the leaders of both countries have vowed to strengthen their economic ties. With nearly £200 billion in British exports each year, the US continues to be the UK’s largest trading partner.
President Trump alluded to the deal on Twitter just last week. He billed it as a “MAJOR TRADE DEAL” and scheduled a press conference to unveil the groundbreaking news. This progress could herald a new era of cooperation between the two countries.
Shadow business and trade secretary Andrew Griffith described the deal as a welcomed positive outcome from Brexit. He announced it as yet “welcome and another Brexit benefit.” He further explained that any compromise would be subject to the most careful scrutiny by Conservatives. He added that it should be announced to Parliament to begin with.
“Big News Conference tomorrow morning at 10:00 A.M., The Oval Office, concerning a MAJOR TRADE DEAL WITH REPRESENTATIVES OF A BIG, AND HIGHLY RESPECTED, COUNTRY. THE FIRST OF MANY!!!” – President Trump
As with intellectual property, the US seems particularly keen on inserting pharmaceutical-related provisions into the deal. In addition to the tariff reductions, they want to focus on technology issues. Both sectors account for the majority of US goods exports and are crucial to the health of the American economy. The UK government hopes to use this opportunity to negotiate improved market access for UK exports in turn.
This agreement is a big step in the right direction. It’s bound to be much narrower in scope than a full-blown free trade agreement. As one example, the ambitious UK-India free trade agreement was announced only two days ago. Experts project it will increase trade between the two countries by £25.5 billion and raise the UK’s GDP by £4.8 billion annually. This backdrop makes it all the more urgent to widen Britain’s trading connections in the wake of Brexit.
Liberal Democrat MP Daisy Cooper welcomed the agreement but warned against celebrating the deal’s impact. She emphasized that while a good trade deal could bring significant benefits, there should be no concessions that threaten the National Health Service (NHS), undermine farmers, or provide tax cuts to US tech billionaires.
As negotiations progress, Sir Keir Starmer personally cultivates a very special relationship with President Trump. This deepening relationship could open the door to future conversations on furthering trade and economic collaboration between the two countries. The UK government has already promised to reduce tariffs on British steel and cars. Simultaneously, they are fiercely committed to ensuring British businesses and consumers are not short-changed.