UK defines tariff deal with US as ‘historic’, but tariffs on British exports remain unchanged
US President Donald Trump and British Prime Minister Keir Starmer on Thursday announced a limited bilateral trade agreement. The agreement maintains Trump’s 10% tariffs on British exports, but it modestly expands agricultural access for both countries and reduces high US duties on British car exports, Reuters reported.
Reuters report said that this “general terms” agreement marks the first of several tariff-lowering deals that Trump anticipates finalising in the coming weeks.
It is to be further noted that these agreements come after the Trump administration implemented steep new import taxes aimed at reducing the $1.2 trillion US goods trade deficit.
Trump hailed the deal in the Oval Office with Starmer patched in on a speaker phone, as US Treasury Secretary Scott Bessent and top trade negotiator Jamieson Greer head to Switzerland to launch negotiations with Chinese negotiators.
He pushed back against seeing the UK deal as a template for other negotiations, saying that Britain “made a good deal” and that many other trading partners may end up with much higher final tariffs because of their large US trade surpluses, Reuters report noted.
In April, Trump imposed reciprocal duties of up to 50% on goods from 57 trading partners including the European Union, pausing them days later to allow time for negotiations until July 9. He has also heaped new 25% tariffs on auto imports, ended all exemptions on steel and aluminum duties, and announced new tariff probes on pharmaceuticals, copper, lumber and semiconductors.
This week Trump added movies to the list.
“It opens up a tremendous market for us,” Trump told reporters, noting that he had not fully understood the restrictions facing American firms doing business in Britain, Reuters reported.
“This is a really fantastic, historic day,” Starmer said, noting that the announcement came nearly at the same hour 80 years ago when World War Two ended in Europe. “This is going to boost trade between and across our countries, it’s going to not only protect jobs, but create jobs, opening market access.”
The two leaders heralded the plan as a “breakthrough deal” that lowers average British tariffs on US goods to 1.8% from 5.1% but keeps in place a 10% tariff on British goods.
It opens up a tremendous market for us.
The British-American Business group expressed disappointment that the deal leaves in place Trump’s 10% tariffs for many products, including cars, raising costs for UK exporters, Reuters reported.
It said it hoped that the deal would be a start of deeper U.S.-UK trade integration including the digital economy. The deal will provide potential new export opportunities for American producers worth $5 billion a year, Lutnick said, while the higher tariffs would generate $6 billion in annual U.S. revenue.
This is a really fantastic, historic day.
