The United Kingdom has won the first agreement with the United States since President Donald Trump sparked a trade war, winning reductions in punitive rates on car and steel exports, but not having reversed a 10% flat tax that applies to most goods.
The pact was unveiled Thursday by the American president at the Oval Office, the British Prime Minister Sir Keir Starmer joining the phone. The two leaders praised the strength of the relationship between their country.
But the scope of the US-UK agreement is limited, many details must be calculated and the end result always leaves Great Britain faced with a more difficult commercial relationship with America than before Trump has introduced global scanning prices last month.
American actions increased after the announcement, investors encouraged by the prospect of new transactions – in particular with China – to limit the damage of the samples that have stifled the trade. The S&P 500 has increased by more than 1%, to its highest intra -day level since March 27, before giving up the field and ending the day by 0.6% more.
The secretary in the United States of the Treasury Scott Bessent and senior Chinese officials should meet in Switzerland this weekend to try to defuse the tariff war between the two biggest economies in the world.
“I’m going to tell you that China wants to conclude an agreement. We will see how it works,” said Trump. When asked if he would plan to reduce American prices on Chinese imports, the American president replied: “At the moment, you cannot get more. It’s 145 [per cent]So we know that it drops.
The US-UK agreement, described by Trump as “complete and complete”, will maintain the 10% American samples from most of the British exports that Trump imposed last month.
According to the text of the agreement published Thursday, the two parties were to continue to negotiate discounts of prices on “importance sectors”.
But it mainly offers the United Kingdom a suspension of additional 25% prices on cars and metals which had previously been fixed by the Trump administration and which were particularly tense for Great Britain.
British steel and aluminum exports are now said to be zero for prices, according to the British government, while the first 100,000 British cars sold in the United States each year – the vast majority of the total – are subject to a decrease of 10%.
“This historic transaction delivers for commercial and British workers, protecting thousands of British jobs in key sectors, including car manufacturing and steel,” said Starmer.
In exchange, the United Kingdom will offer American farmers and farmers access to the market through a lower rate quota system, but without modifying its food standards, opening the way to certain beef imports. The United Kingdom will remove its price on up to 1.4 billion liters of American ethanol.
“Our greatest concern is that …
Trump and Starmer teams have also agreed to work on a digital commerce pact to deepen cooperation and to respond to American concerns concerning the digital services of the United Kingdom, which is targeting Big Tech, which remains in place for the moment.
The two parties agreed to negotiate more on pharmaceutical products, to which the US officials said that the prices would have applied in a few weeks.
“The United States and the United Kingdom have been working for years to try to conclude an agreement, and he has never been successful. He did it with this Prime Minister,” said Trump in the White House, flanked by JD Vance, Vice-President, Howard Lutnick, US trade secretary, and Lord Peter Mandelson, the UK ambassador to Washington.
Addressing workers at the Jaguar Land Rover factory in the West Midlands, Starmer said the agreement was the start of a process. “These are work saved, not work done,” he said. “We will continue to rely on this agreement.”
He said he had also negotiated “preferential treatment” for the United Kingdom if Trump decides in the future to raise prices on pharmaceutical products or other sectors, including films.
But Andrew Griffith, spokesperson for conservative commerce, said that the agreement was disappointing, the appellant “a diet coke agreement, not the real thing”. Conservative chief Kemi Badenoch said: “We have just been broken.”
The US agreement with the United Kingdom could provide a model for American negotiations with other countries – with India, Vietnam, Japan and South Korea considered to be closest to the realization agreements with Washington.
But Trump warned that the United States would insist on the fact that the overall samples from countries with major trade surpluses with America could remain much higher than 10%. “Some will be much higher,” he said. “The 10 model is probably the lowest,” he added.
The US-UK agreement has also raised issues among legal and commercial experts as to whether it was rules of the World Trade Organization which require that the prices be applied equally.
Ignacio García Bécero, a former senior European Commission official now at the Bruegel reflection group, said the British decision to reduce prices for American exporters without extending the same agreement to other countries risked legal challenges.
As part of the concept of the “most favored nation” of the WTO, countries must offer the same rates of prices to all countries, unless they are reduced via a bilateral trade agreement which covers “almost all of the trade”, which the British-American pact did not announce on Thursday.
“It is a worrying that the United Kingdom has offered preferential tariff concessions in the United States. In the absence of commitment from the United States to eliminate prices on other countries, this cannot be justified,” added Bercero.
But a commercial lawyer, who refused to be appointed, stressed that the WTO rules allow trade agreements to be introduced by progression. “They could say that this is the start of the negotiations of the free trade agreements, then take 10 to 15 years to” conclude “,” they said.
Additional Kate Duguid reports in New York
