US-UK trade deal set to be finalised

Automobiles parked at the Port of Baltimore’s import lot in Maryland, US, as manufacturers assess the implications US President Donald Trump’s tariffs. Pic/AFP

The US and Britain were set to announce a trade deal on Thursday that will lower the burden of President Donald Trump's sweeping tariffs and deliver a political victory for UK Prime Minister Keir Starmer. Trump posted on Truth Social that a deal due to be announced at 10 am (local time) will be a "full and comprehensive one that will cement the relationship between the US and the UK for years to come".

It's the first bilateral trade deal announced since Trump began slapping tariffs on US trading partners. Trump said, "Many other deals, which are in serious stages of negotiation, to follow!" Starmer's office said the prime minister would give an "update" about US talks later. The US President placed a 10 per cent tax on imports from Britain, as well as 25 per cent tariffs on autos, steel and aluminum on the premise that doing so would foster more factory jobs domestically.

A major goal of British negotiators has been to reduce or lift the US import tax on UK cars and steel. The US is the largest destination for British cars, accounting for more than a quarter of UK auto exports in 2024, according to the Office for National Statistics. Britain has also sought tariff exemptions for pharmaceuticals, while the US wants greater access to the British market for agriculture products. Starmer's government has said it won't lower UK food standards to allow in chlorine-rinsed American chicken or hormone-treated beef.

A deal with the UK would be symbolically important, and a relief for British exporters. But an agreement would do little to address Trump's core concern about persistent trade deficits that prompted him to impose tariffs. The US ran a $11.9 billion trade surplus in goods with the UK last year. The $68 billion in goods that the US imported from the UK last year accounted for just 2 per cent of all goods imported into the country, but the country remained Britain's biggest trading partner.

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