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Trump and Starmer confirm ‘breakthrough’ US-UK trade deal Trump and Starmer confirm ‘breakthrough’ US-UK trade deal
(about 1 hour later)
Announcement makes UK the first country to agree deal with US since Trump imposed sweeping tariffs in AprilAnnouncement makes UK the first country to agree deal with US since Trump imposed sweeping tariffs in April
Donald Trump and Keir Starmer have announced a “breakthrough” trade deal that is expected to slash US tariffs on cars, aluminium and steel. The UK and US have agreed a “breakthrough” trade deal that will slash some of Donald Trump’s tariffs on cars, aluminium and steel and which the prime minister said would save thousands of British jobs.
Speaking from the White House, with Keir Starmer on speakerphone, the US president said the bond between the US and UK would be “stronger than ever before”. Keir Starmer said it was a “fantastic, historic day” as he announced the agreement, the first by the White House since Trump announced sweeping global tariffs last month.
Starmer said it was a “fantastic, historic day” for the two countries and that the agreement was “hugely important for sectors like car manufacturing, and for steel and aluminium and so many others”. Starmer, speaking to workers at the Jaguar Land Rover plant in Solihull, said the agreement had saved jobs in the car and steel industries that had been under threat.
“Yes, we can finish ironing out some of the details but there’s a fantastic platform here,” the prime minister said. Paul Nowak, general secretary of the TUC, said the deal “takes us back from the brink and many workers will breathe easier as a result”.
The announcement makes the UK the first country to agree a deal with the US since Trump unveiled sweeping tariffs in April. The US president’s “liberation day” moves sent global stock markets plunging for days until Trump announced a 90-day pause, which will expire on 9 July. However critics said it had failed to address many of the high tariffs that remain in place between the two countries.
The US president said Thursday’s deal would lead to the creation of an aluminium and steel trading zone and a secure pharmaceutical supply chain. John Denton, secretary general of the International Chamber of Commerce, said: “The reality is that US tariffs on UK exports remain significantly higher than they were at the start of the year.” He said it was still unclear what would happen to industries not explicitly covered by the deal, such as pharmaceuticals.
The British ambassador to the US, Peter Mandelson, who played a pivotal role in the negotiations, also announced a “technology partnership” with the US that would be negotiated “over the coming months”. The US agreed to cut the 25% tariff rate on British steel and aluminium exports to zero. The concession will be seen as a lifeline to the steel industry, for which the US is an important export market and which has been on the verge of collapse.
It is understood that has been driven by the US vice-president, JD Vance, who is keen to harness research and science in both countries including artificial intelligence, bioengineering and quantum physics in bioengineering, which will lead to advancements in medicine, diagnostics and materials science. American tariffs on up to 100,000 British cars will also be reduced to 10%, down from the 27.5% rate Trump initially announced. The US is the main export market for British cars, worth more than £9bn last year.
British and US negotiators have been in talks for weeks over a carve-out. The UK has been focused on agreeing a deal that will lower US tariffs on British steel, aluminium and cars. The US is the main export market for British cars, worth more than £6bn last year, and is also an important market for British steel. Washington promised to give “preferential treatment” to the UK’s pharmaceutical industry, which Trump has also threatened with tariffs, although none have been set yet, and American aerospace manufacturers will receive preferential access to high-quality UK aerospace components. A 10% baseline tariff on most goods remains in place.
Ministers are expected to update MPs on the talks with the US with a statement in the Commons later. There was relief, too, that British beef farmers will be allowed access to the US market, joining a small group of countries including Australia, while US farmers will be granted new access to the UK.
The deal with the UK will be seen as a vindication of the conciliatory approach Starmer has taken towards Trump, which has faced criticism from some Labour MPs and the Liberal Democrats. Starmer said there would be no watering down of food standards with this measure, with imports of hormone-treated beef or chlorinated chicken remaining illegal.
Despite their considerable political differences the prime minister has sought to build a rapport with the US president and has declined to criticise him directly over tariffs or his statements on Russia or Gaza. “I know people along the way were urging me to walk away, to descend in a different kind of relationship. We didn’t,” the prime minister said. “We did the hard yards. We stayed in the room. I’m really pleased to say to the workforce here and through them to the country, how important I think this deal is.”
UK government officials were blind-sided by the timing of the announcement, however. Industry figures were only informed of it in the early hours of Thursday. But he added it was “jobs won, not jobs done” and the UK would keep negotiating in areas including tech, where ministers want to improve cooperation with the US, and the film industry, which Trump has also threatened with tariffs.
The US has been under pressure to strike tariff agreements to shore up the US economy. In a sign of how quickly UK and US officials raced to announce an agreement, Trump said on Thursday “final details” were still being written up. Peter Mandelson, the UK’s ambassador to the US, said a “technology partnership” would be negotiated “over the coming months”. JD Vance, the US vice-president, is expected to play a key role.
Starmer said he had “not at all” been bounced into the deal by Trump but admitted he “didn’t know the exact day” it would be finalised. The announcement was made in a choreographed phone call between Starmer and Trump, while the press gathered with the leaders on either end of the line.
“I wouldn’t have been having my phone call with Trump halfway through the Arsenal PSG game,” he said. Kemi Badenoch, the Conservative leader, criticised the deal, claiming that the UK has been “shafted” by Trump. “When Labour negotiates, Britain loses. We cut our tariffs – America tripled theirs. Keir Starmer called this ‘historic.’ It’s not historic, we’ve just been shafted!” However Andrew Griffith, the shadow trade secretary, said the reduction in tariffs would “be welcomed by exporting businesses”.
For months, as economists warned his controversial trade strategy risked triggering a recession, Trump and his closest officials insisted it would set the stage for the White House to hammer out dozens of trade deals. The final stages of negotiations were mired in chaos after UK officials scrambled to announce the deal when it became clear that Trump was ready to finalise it on Wednesday night. Industry figures were informed of it only in the early hours of Thursday.
But earlier this week, the US president pushed back against “everyone” asking when such agreements would be struck. “We don’t have to sign deals,” he said in the Oval Office on Tuesday. “They have to sign deals with us. They want our market. We don’t want a piece of their market. We don’t care about their market.” Starmer said he had “not at all” been bounced into the deal but “didn’t know the exact day” it would be completed. “I wouldn’t be having my phone call with President Trump halfway through the second half of the Arsenal v PSG game had I planned it better. That’s the way it turned out and that’s the discussion we were having late last night about how we proceeded with this deal,” he said.
US deals with other leading economies including India and Japan, while repeatedly mooted by administration officials, have yet to come to fruition. Scott Bessent, the Treasury secretary, claimed this week that talks were under way with 17 trading partners. UK government officials said the deal was a starting point from which the two sides would keep negotiating. Jonathan Reynolds, the business and trade secretary, told reporters that the UK would continue trying to reduce the 10% baseline tariff. He said the agreement did not include any concessions on the digital services tax, online safety laws, or the NHS.
By Thursday morning in the Oval Office, Trump took a different tack. US officials had “many meetings planned”, the president said, noting that Bessent would be meeting Chinese counterparts in Switzerland on Saturday. “Every country wants to be making deals.” The UK is the first country to strike an agreement with Trump since his announcement of global tariffs on what he called “liberation day”. That sent global stock markets plunging for days until Trump brought in a 90-day pause, which will expire in July.
The content of the deal will be closely scrutinised after reports that the UK was preparing controversial concessions, including cutting tax on US tech companies and reviewing the enforcement of new online safety laws, to secure it. The US has been under pressure to strike tariff agreements to shore up its economy. For months, as economists warned Trump’s trade strategy risked triggering a recession, the president and his closest officials insisted it would set the stage for the White House to hammer out dozens of trade deals.
British ministers have ruled out watering down food standards as part of the negotiations. Food campaigners and farmers are staunchly against any move that could allow chlorine-dipped chicken and hormone-treated beef to be sold in British supermarkets. US officials are in talks with other leading economies, including India and Japan, but agreements have yet to materialise. Scott Bessent, the Treasury secretary, said this week that talks were under way with 17 countries.
Sources at the Department for Environment, Food and Rural Affairs said imports of hormone-treated beef or chlorinated chicken would remain illegal, and that the deal would open up exclusive access for UK beef farmers to the US market. Only a few countries such as Australia have this access. In Westminster, the Liberal Democrats called for a vote on the agreement, saying it would show “complete disrespect to the public” if MPs were denied a say, especially with talks continuing and the potential for more details to emerge around contentious issues such as food safety.
The trade deal includes £5bn worth of agricultural exports from the US to the UK. The US agriculture secretary, Brooke Rollins, told reporters she hoped to expand the agreement to include all meats and that she would be visiting the UK next week to make this point, adding: “There is no industry that has been treated more unfairly than our agriculture industry.”
The US agriculture secretary, Brooke Rollins, told reporters: “This [trade deal] is going to exponentially increase our beef exports. American beef is the crown jewel of American agriculture for the world.” Tom Bradshaw, president of the National Farmers’ Union, said he welcomed reciprocal access to the US beef market, but was concerned imported American beef would be produced to a lower standard.
UK ministers have been clear that chlorinated chicken and hormone-treated beef would not be included in any deal, but Rollins said she hoped to expand the agreement to include “all meats” and that she would be visiting the UK next week to make this point, adding: “There is no industry that has been treated more unfairly than our agriculture industry.”
Trump, however, mentioned that US agriculture could end up being produced to higher health and environmental standards under the leadership of his health secretary, Robert F Kennedy Jr, adding: “Bobby Kennedy is probably heading towards your system”, suggesting he may ban certain methods of production.
UK government officials said the deal was a starting point from which the two sides would keep negotiating. Ministers are hopeful of further concessions on the British pharmaceutical and film industries, which face a severe hit.
In a post on Truth Social earlier on Thursday, Trump said it was a great honour to reach the first agreement with the UK “because of our long time history and allegiance together”.
The UK government is in talks to host Trump for a state visit later this year, after Starmer personally handed him an invitation from the king during their first White House meeting in February. The US president suggested last month that Buckingham Palace was setting a date in September. It would make Trump the first world leader in recent history to be invited for a second full state visit to the UK.