SOURCE :- THE AGE NEWS
Washington: The United States and Britain announced the outline of a trade deal that will reduce tariffs and non-tariff barriers for selected goods, in what US President Donald Trump and UK Prime Minister Keir Starmer described as a historic moment between two great allies.
It was the first such deal to be struck following Trump’s unilateral declaration of “reciprocal tariffs” on April 2, although his 10 per cent blanket tariff on British goods will remain in most cases. Both sides acknowledged the details were yet to be finalised.
Vice President J.D. Vance, President Donald Trump and British ambassador Peter Mandelson applaud a trade deal between the UK and US.Credit: Bloomberg
The White House said the deal would increase market access in the UK for about $US5 billion ($7.8 billion) of American products, including ethanol, soft drinks and agricultural products such as beef – which is also a key trade grievance between the US and Australia.
Tariffs will be reduced to 10 per cent from 27.5 per cent for the first 100,000 British cars imported into the US each year, which accounts for almost all of them, and the current 25 per cent tariff on UK steel and aluminium will be slashed to zero, subject to a quota.
Starmer, who phoned into the Oval Office for the announcement, called it a “truly historic” deal and “fantastic platform” on which to flesh out the details. “This is going to boost trade between and across our countries. It’s going to not only protect jobs, but create jobs.”
A White House fact sheet said the average UK tariff would fall from 5.1 per cent to 1.8 per cent, while the US’s tariffs would increase from 3.4 per cent to 10 per cent, raising $US6 billion in government revenue.
Howard Lutnick, US commerce secretary, hailed the deal as a “breakthrough” that will bring down barriers and expand market access for American imports.Credit: Bloomberg
Both leaders portrayed the deal as a political win. Trump, who has been under pressure to make good on his promise to strike dozens of deals with US trading partners, said it was the first of many to come, although he indicated the 10 per cent baseline tariff was likely to remain the lowest available rate.
“The final details are being written up,” Trump told reporters. “In the coming weeks, we’ll have it all very conclusive.”
Starmer, whose Labour Party suffered significantly in local elections last week and who had been criticised for prioritising trade negotiations with Washington over Brussels, said the outcome was a win for British workers.
“Yes, we would like to go further in relation to tariffs, but … we’ve been able to protect, save and enhance jobs right here and right now,” he said at a press conference at a Jaguar Land Rover car factory minutes after the deal was announced.
Keir Starmer immediately appeared at a Jaguar Land Rover factory in the West Midlands to announce the deal.Credit: Bloomberg
Starmer was asked if the outcome was better than the status quo between the two countries six months ago, before Trump. “The question you should be asking is: is it better than where we were yesterday?” he replied.
In the Oval Office, Britain’s ambassador to the US Peter Mandelson revealed Trump made a late night call to Starmer “demanding even more out of this deal than anyone expected”.
Mandelson described the deal as “not the end, it’s the end just of the beginning”. Both sides could do more to reduce tariffs and other trade barriers, he said, but told Trump: “You’ve launched us extremely well today.”
Both leaders also stressed the symbolism of the trade deal being announced on May 8, 2025, exactly 80 years after Victory in Europe Day marked the Allied victory and official end of World War II in Europe.
Britain’s ambassador to the US, Peter Mandelson (right), laughs at a comment by US President Donald Trump.Credit: AP
Trump was optimistic about trade talks between the US and China, which are due to begin this weekend when Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer meet their counterparts in Geneva, Switzerland.
“They very much want to make a deal,” Trump said of China. Bessent told Fox News the Geneva meeting would primarily involve de-escalating tensions rather than discussions about a trade deal.
Australia has largely hit pause on trade talks with Washington due to the federal election and the government being in caretaker more. Re-elected Prime Minister Anthony Albanese discussed tariffs with Trump during a congratulatory phone call earlier in the week, but did not divulge details.
The US and the UK have been aiming to strike a bilateral trade agreement since the British people voted in 2016 to leave the European Union, allowing the country to negotiate independently of the rest of the continent. Then-prime minister Boris Johnson touted a future deal with the US as an incentive for Brexit.
Negotiations started in 2020, during Trump’s first term. But the talks made little progress under President Joe Biden, a Democrat and a critic of Brexit. Negotiations resumed after Trump returned to office in January, and intensified in recent weeks.
with AP
