Meanwhile, the United States and the United Kingdom have trumpeted a gold standard trade agreement. This is the first trade agreement clinched by the Trump administration since it slapped tariffs on foreign imports in early April. This new agreement, described by President Donald Trump as a pathway to preserve thousands of “really important, skilled, well-paid jobs” in Britain, aims to strengthen the economic ties between the two nations.
Trump called the UK “truly one of our greatest allies,” highlighting just how vital this relationship is. The agreement lowers tariffs on chocolate and a number of other products. Moreover, it drops the import duty on UK-built cars coming to the US market from 27.5% to 10%, marking a big win for UK manufacturers.
The deal comes at a time when trade relations in general are under intense scrutiny. Last year, our governments announced that US exports to the UK reached $79.9 billion (€70.7 billion), while imports from the UK amounted to $68.1 billion (€60.3 billion).
Tariff Reductions and Export Increases
The signed new trade deal cuts the tariff on imports of vehicles and steel and aluminum – the tariff was 25% and is repealed. This Trump-imposed levy on Mar. 12 had turned US-Mexico relations upside down. This cut is expected to increase UK exports to the US by £37 million. For 2024, these have increased to 180 thousand tonnes of semi-finished and finished steel, worth a total of £370 million (€436.5 million).
The deal increases American beef and ethanol exports to the UK. It modernizes and streamlines customs processes to accelerate and facilitate trade. Increasing access through trade is expected to provide a boon of new market opportunities to American farmers and agricultural producers.
“The deal includes billions of dollars of increased market access for American exports, especially in agriculture, dramatically increasing access for American beef, ethanol, and virtually all of the products produced by our great farmers.” – Donald Trump
Strengthening Bilateral Relations
This is wonderful news for all of our members! He pointed to their common values, culture and language as foundational elements that bring them together. “It’s a genuine compliment to our long shared history of working in such close concert,” Starmer added. Mostly then, he reflected on the deep connections that made this unique settlement possible.
Significantly, Starmer hinted that a big cut in EU tariffs was important to getting a deal that served UK interests. Getting that decrease was incredibly important to me,” he said. He pointed out that this agreement is an unprecedented victory for both parties.
The trade deal arrives on the heels of a contentious and historically unique bilateral trade environment. In 2024, the UK exported £59.3 billion (€70 billion) worth of goods to the US while importing £57.1 billion (€67.4 billion) from it. Analysts are cautioning against reading too much into the bilateral balance of trade between the two nations. That’s largely because of gaps in reporting.
Future Prospects and Negotiations
Trump indicated that there are “many other deals, which are in serious stages of negotiation.” This statement teases at thrilling new possibilities for future trade agreements. Such agreements could greatly increase economic cooperation between the US and its allies, strengthening everyone’s economies in the process.
The recent US-UK trade deal is an important step forward in US-UK relations. It sets a collaborative precedent for both countries to negotiate as they encounter, and even lead, an increasingly dynamic global economic order.
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