President Donald Trump has approved a new trade arrangement with the United Kingdom that reduces some tariffs on British exports, including automobiles and aerospace goods, though it stops short of removing steep charges on steel.
The deal, finalized after weeks of negotiations, allows up to 100,000 UK-built cars to enter the United States under a 10 percent tariff. This marks a significant cut from the 25 percent tax imposed earlier this year.
British officials hope the move will cushion the blow of American protectionist measures, which have unsettled industries that depend heavily on transatlantic trade.
Prime Minister Sir Keir Starmer welcomed the development at the G7 summit in Canada, calling it “a very important day” for both nations.
However, the agreement did not resolve uncertainty over steel and aluminium. While the US pledged to establish a system for those sectors, it offered no clear timeline.
When pressed about steel tariffs, President Trump gave little detail but insisted the UK is “very well protected” due to his personal regard for the country.
Currently, British steel faces a 25 percent US import tax. Without an exemption by 9 July, that rate could double. The UK government says it remains committed to reducing that burden.
Transport Secretary Heidi Alexander said work continues on resolving technical issues around the steel requirements, especially the rule that steel must be “melted and poured” domestically to qualify for relief.
UK Steel chief Gareth Stace urged the government to secure clarity, warning that unresolved quotas could hurt producers.
On Monday, carmaker JLR cut its earnings forecast after pausing US exports in April. Industry group SMMT said the reduced tariff will help UK firms regain competitiveness against rivals from Italy and Germany, who still face the full rate.
In return, the UK will lift a 20 percent tax on American beef and raise import quotas to 13,000 tonnes. Officials emphasized that all US meat must meet existing UK food safety standards.
The government also agreed to allow 1.4 billion litres of US ethanol to enter the UK duty-free. Domestic producers have warned of serious consequences.
ABF Sugar, owner of the UK’s largest ethanol facility, said the move threatens local jobs. Its chief executive, Paul Kenward, set a 25 June deadline for state support to avoid potential layoffs at its Hull plant.
Despite ministerial praise, the pact is not a full free-trade deal. Trump lacks congressional authority to sign one, and critics argue the deal falls short of previous promises.
Opposition leaders have voiced concern. Conservative Party head Kemi Badenoch called the deal “tiny,” while Liberal Democrat Treasury spokesperson Daisy Cooper demanded more transparency on its economic impact.
Trade Secretary Jonathan Reynolds said Parliament will receive updates on how the government will manage new quotas and uphold national interests.
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