The UK is the first to sign a trade deal with the US after Trump announced his “Liberation Day” tariffs (Alamy)
3 min read
A trade deal agreed between the UK and the US will see tariffs on British steel reduced to zero, the two sides announced on Thursday.
The agreement comes after growing concern about the future of the UK steel industry, with the government last month passing emergency legislation to prevent the British Steel factory in Scunthorpe from collapsing.
Also as part of the bilateral deal — the first signed by President Donald Trump since he launched his “liberation day” tariffs in April — tariffs on UK cars being sent to the US will be reduced from 27.5 per cent to 10 per cent.
This reduction will apply to a quota of 100,000 UK cars, which Downing Street said is almost the total exported last year.
Trump announced the deal in the White House, where Keir Starmer joined via phone call. The Prime Minister then made his own announcement at a Jaguar factory in the West Midlands.
Speaking there, Starmer said that the tariff reduction on cars “was hugely important to me”.
“I’m really pleased to come back here to be able to look you in the eye and to say, I’ve delivered on the promise I made to you,” the PM told workers.
He added that the deal announced today was a vindication of the Labour government’s approach to dealing with the Trump administration after the US hiked tariffs on countries including the UK last month.
“In recent years, an idea has taken hold that you somehow show your strength by rejecting your allies, that you shut the door, put the phone down, storm off.
“I’ve had plenty of people urging me to do that, rather than stay at the work in the room, and fight for the interests of our country,” he said.
US tariffs on UK goods will still be higher than they were prior to Trump’s “liberation day” policy, however.
Elsewhere, the tariff on ethanol coming into the UK from the US has been reduced to zero.
London and Washington have also agreed to a reciprocal deal on beef that will see more US meat sold in the UK. The government insisted that British food standards would not be lowered as a result of this element of the trade deal.
The digital services tax, which had previously been touted as a possible part of the deal, remains unchanged as part of today’s deal.
While the full details of the trade deal are still to be completed, Trump told reporters in the White House that the “final details are being written up” but that “just about everything has been approved”.
Starmer said today that the announcement of the deal was: “Not job done, because we’re more ambitious for what the UK and US can do together.”
“So we’re hammering out further details to reduce barriers to trade with the United States.”
Starmer also reinforced the need for a “calm and pragmatic” approach to negotiations.
He added: “We work for our country, with a national interest at the forefront of our mind, because the other way of working doesn’t deliver the benefits that working people need.”
In a phone call broadcast to the media ahead of Starmer’s speech in the West Midlands this afternoon, Trump and Starmer praised the work of the negotiators, who “had been working at pace” in recent weeks to get the trade deal over the line.
Starmer added that this was a “fantastic, historic day” and “a real tribute to the history that we have of working so closely together”.
Trump thanked Starmer and his “very talented team for their outstanding work and partnership”, adding that efforts to deliver a US trade deal with the UK had previously been going on for years without success.
