TMTPOST -- U.S. President Donald Trump on Monday signed a trade deal to cut some tariffs on the United Kingdom, finalizing the first trade agreement of the Trump administration with its trading partners since his sweeping worldwide reciprocal tariffs were imposed in April.
Credit：Xinhua News Agency
Trump and UK Prime Minister Keir Starmer said they had finalized a trade deal. Calling the U.S.-UK relationship is 「fantastic」, Trump told reporters during the G7 summit held in Canada that the deal will produce 「a lot of jobs, a lot of income」, adding that 「we have other many, many other ones coming. 「 Trump touted it a 「 fair deal for both」, while mistakenly referring to 「EU agreement」.
Trump said the UK is 「very well protected」 in response to a question about future tariffs. 「You know why? Because I like them,」 he said. When asked if there are more deals to come, Trump replied: 「Yes. A lot of them.」 Starmer, standing next to Trump, said the deal marks 「a real sign of strength」, and it 「now implements on car tariffs and aerospace」, without providing details. Trump later Monday signed an executive order to implement tariffs cuts on UK imports.
According to the agreement shared by the White House, the U.S. will create an annual quota of 100,000 vehicle imports from the UK, and imported cars within the quota will face a 10% tariff, down from 25%. The two countries committed to "strengthen aerospace and aircraft manufacturing supply chains" by establishing tariff-free trade for certain aerospace products.
The agreement suggested the two allies had to hold further talks on steel and aluminum tariffs. The U.S. Commerce Secretary Howard Lutnick will design and establish a tariff-rate quota for aluminum and steel articles and their derivative products of the UK that can enter the United States without being subject to the 25% Section 232 tariffs. If the UK meets certain requirements, the US will create a "a quota at most-favoured-nation rates for steel and aluminium articles" imported from the UK.
The UK government on Monday said the plan was still for 「0% tariffs on core steel products as agreed.」
Most of the trade agreement was in line with the framework that Washington and 10 Downing Street unveiled more than a month ago.
Trump on May 8 unveiled the outlines of a 「historic agreement」 with the UK on trade that remains short on details. Trump said the deal will involve billions of dollars of American exports including American beef, ethanol, and other agricultural products, and the U.K. will fast-track goods through its customs processes as the U.S. receives new market access for machinery and chemicals. The Kingdom will reduce or eliminate numerous non-tariff barriers that unfairly discriminated against American products, stated the president.
The baseline reciprocal tariff rate of 10%, which was announced on April 2, a date Trump proclaimed 「Liberation Day」, is still in effect, according to a fact sheet from the White House. That means the Trump administration will keep in place a 10% baseline U.S. tariff on U.K. imports. Meanwhile, the U.S. agreed to cut car tariffs on the U.K. to 10% from 25%.
Under the deal, the first 100,000 vehicles imported into the U.S. by UK car manufacturers each year are subject to the reciprocal rate of 10% and any additional vehicles each year are subject to 25% rates, according to the fact sheet.
The 10 Downing Street highlighted the deal with the U.S. saves thousands of jobs for British car makers and steel industry. It said car export tariffs will reduce from 27.5% to 10% - saving hundreds of millions a year for Jaguar Land Rover alone. This will apply to a quota of 100,000 UK cars, almost the total the UK exported last year.
The U.K. steel industry will no longer face tariffs thanks to the deal, the U.K. government said, adding that Starmer negotiated the 25% auto tariff down to zero, meaning U.K. steelmakers can carry on exporting to the US.
Trump on June 3 signed a proclamation to raised tariffs on steel and aluminum imports into the country to 50% from 25%, taking into effect on June 4. The president believed raising the tariffs will provide greater support to steel and aluminum industries and reduce or eliminate the national security threat. But he granted exemptions from new tariffs for UK imports. Trump in the proclamation said he had decided that it is necessary and appropriate to allow for the implementation of the U.S.-UK Economic Prosperity Deal of May 8, 2025 (EPD), and to accordingly provide different treatment for U.K. exports to U.S.
