UK politics: Tariffs cut on UK cars, steel and aluminium in US trade deal, says Starmer – as it happened
Keir Starmer is at a Jaguar Land Rover factory.Summing up the deal, he says:This is a deal that will protect British businesses and save thousands of jobs In Britain, really important, skilled, well paid jobs.It will remove tariffs on British steel and aluminium, reducing them to zero.It will provide vital assurances for our life sciences sector, so important to our economy, and grant unprecedented market access for British farmers without compromising our high standards.And he says the deal means US tariffs on cars from the UK will be cut from 27.
5% to 10% for 100,000 vehicles every year.He claims that, as he negoiated the deal, he kept his focus on the needs of car workers.In politics, what matters sometimes is who you have in your mind’s eye when you’re making these deals.Who do you have in your mind’s eye when you’re taking decisions? But what I took away from here last time [I was here] was you and the brilliant work that you do, and had you in my mind’s eye as we did that.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 government has published its summary of the deal here and the White House has provided its summary of the deal here.At a briefing for journalists in Westminster, Jonathan Reynolds, the business secretary, said the deal would safeguard thousands of British jobs, particularly in the automative sector.He said:It is important to remember there are two parts to the US tariff agenda.There’s the sectoral tariffs that have been announced, automotive being a good example of those.And then there is the reciprocal tariff figure, the 10% you will be familiar with.
So this landmark breakthrough today agrees general terms to set out the process by which we will agree the detail on the tariffs in relation to those reciprocal tariffs – that negotiation about the 10%.But it provides immediate changes and movement on the sectal tariffs.So specifically, the automotive tariff, which was effectively 27.5% – 25% plus the 2.5% which is the MFN [most favoured nation[ tariff for the US – will be reduced to 10% for a quota of 100,000 vehicles a year being exported from the UK to the US.
That is broadly the current level of UK automotive exports to the US,On steel and aluminium and derivatives, which again had been set at 25%, that will be reduced to 0% …In exchange for that, we have agreed provisions with the US, specifically on beef, ethanol and on economic security,So in relation to beef, the US currently shares a quota of 1,000 metric tonnes alongside Canada,Canada accesses that at a 0% tariff, the US at a 20% tariff,That will be reduced to the US, comparable to Canada, to 0%.
And in addition there will be an additional quota for the US of 13,000 metric tonnes created at a 0% tariff.By way of comparison, when the former Conservative government agreed the Australia trade deal that was for a quota for 35,000 metric tonnes, which rises to 110,000 metric tonnes over time.If that quota were filled, that bigger quarter from the US to the UK, that would amount to broadly 1.5% of the UK beef market.Crucially, that is SPS [sanitary and phytosanitary] compliant beef.
That is beef that meets our existing SPS standards, And it is reciprocal, so we gain the same from the US as we are giving to them in the UK.On ethanol, there is currently no tariff-free quota for US exports to the UK, it’s subject to a tariff graduating from 10 to 50%, it depends on how you use the ethanol, whether you are using it for fuel or food.There will be a new tariff free quota of 1.4bn litres for the US.Last year, US ethanol exports to the UK amounted to 860,000bn litres.
So that is beef and ethanol in relation to the provisions around economic security.But, at a news conference, Keir Starmer would not deny that, even with the deal, the UK remains worse off than it was before President Trump imposed his global tariffs.(See 4.33pm.) Kemi Badenoch, the Tory leader, said the UK had been “shafted”.
(See 5.03pm.)There is ongoing coverage on our US live blog.For a full list of all the stories covered here today, scroll through the key events timeline at the top of the blog.Here is some more comment on the deal from trade specialists.
From Liam Byrne, the Labour chair of the Commons business committeeAt first blush, it looks like the UK has stolen first-mover advantage and delivered the big win-win in #TrumpTariffTalks – complete with long-term guarantees,A modest retreat on agriculture has unlocked a major reprieve for tens of thousands of jobs in the UK’s car and steel industries, in a deal that does not compromise our ability to pursue a big, bold reset with the European Union on 19 May,The transatlantic alliance has been strengthened— and not at the expense of our cross-Channel possibilities,There is one major disadvantage, the 10% general tariff remains – but its removal was always a long shot with this administration,From John Denton, secretary general of the International Chamber of Commerce, a global business organisationToday’s agreement is a welcome signal that the US administration is serious about engaging with its trade partners and striking new deals.
While the deal offers some strategically important relief for British manufacturers, the reality is that U.S.tariffs on UK exports remain significantly higher than they were at the start of the year.It also remains unclear how this agreement will sit alongside any future sector-specific tariffs – in areas such as pharmaceuticals – which risks clouding long-term confidence in transatlantic trade relations.More broadly, today’s deal seems to confirm that – even with a series of bilateral agreements – the world economy is facing the steepest rise in U.
S.tariff levels since the 1930s.This remains, to be clear, a significant downside risk to business investment and global growth.From Marley Morris, a trade specialist at the IPPR, a left-leaning thinktankToday’s deal is the second big win for UK trade this week.The government managed to negotiate lower tariffs on steel and cars exported to the US, while maintaining clear red lines on food standards.
Contrary to expectations, there was also no change to the UK’s digital services tax.Instead, the government compromised by agreeing tariff reductions on items like beef and ethanol.The deal does not remove Trump’s 10% universal tariff, but this was always unlikely.In an exceptionally unpredictable global trading environment, the government has played its hand well.From Prof Emily Jones, a trade specialist at Oxford University’s Blavatnik School of GovernmentThis deal looks like a skilful piece of negotiation from Keir Starmer and his team.
While we are still worse off overall than we were a year ago, and subject to 10% tariffs in most areas, the sky-high tariffs applied to the steel and car industry have been reduced.In return the UK seems to have made some modest concessions, including opening up its market to some more beef and ethanol.The UK has done well to keep further tax breaks for US tech giants off the table but there is a big question mark over whether this and other concessions will be part of the future technology partnership.Helena Horton is a Guardian environment reporter.Tom Bradshaw, president of the National Farmers’ Union, told the Guardian he is concerned the beef imported from the US will be produced to a lower standard than the UK product.
He said:80% of our beef diet comes from grass so it’ll be interesting to see exactly what the standards for the imported beef is.We are unclear on that as the details are still being worked on.Many beef cattle are fed with soy, which can be bad for the environment as it comes from sensitive areas including the Amazon rainforest.Bradshaw said the “main focus” in their recent lobbying was on hormone-treated beef, but said “the large US beef lots were also a big concern for our members – we will be watching that very closely.”The US has vast factory farms for its beef, which outcompete those in the UK, farmers fear.
Bradshaw added:What we need to look at is how the US beef is produced, what are the health and welfare standards and what is the diet,Our beef is one of the most sustainable in the world,However, he said he was pleased the UK secured reciprocal access to the beef market, adding:We’ve had a very clear ask that we wanted reciprocal access back, and the red lines on animal health and welfare standards have thankfully been maintained,We cannot see agriculture used as a pawn to shoulder the burden of tariffs,US Agriculture secretary Brooke Rollins said she hopes to expand today’s agreement to include “all meats” and that she will 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.
”Bradshaw replied “good luck with that,” adding: “The government is trying to negotiate with the EU at the same time so that sounds unfeasible.”In the Commons Andrew Griffith, the shadow business secretary, responded to Douglas Alexander on behalf of the Conservative party.He was also critical of the US-UK trade deal, although his language was more parliamentary than Kemi Badenoch’s.(See 5.03pm.
) He said the deal did not go far enough.If I’ve understood the minister correctly, we’re still not back to the position as it was at the beginning of February.British goods will still be more expensive in the US than they were before.For all the special relationship, that puts us in the same category of countries as Burundi and Bhutan.And more than what’s in this deal today is what is not.
From the little the government has shared, it’s clear that the deal doesn’t go anything like far enough.It’s a Diet Coke deal, not the real thing.Business leaders have welcomed the US-UK trade deal.Shevaun Haviland, director general of the British Chambers of Commerce, said:This deal will be met with a huge sigh of relief by many British businesses.The reduction in the 25% tariffs on most of our automotive exports and the removal of levies on steel and aluminium are the biggest wins.
These sectors had been left reeling as jobs, investment and sales were all cut or put on hold.This framework agreement will give them some much needed certainty.They will be keen to see it quickly enacted so they can swiftly re-establish orders and supply chains.The news on aerospace, including jet engines is also good news, as is additional protection from tariffs on our pharmaceutical sector.But this must not be the end of the process; we must continue to push the argument for free and fair trade across all economic sectors and that tariffs are a lose-lose position.
And Rain Newton-Smith, chief executive of the CBI, said:This week, the UK government should be commended for securing a trade deal with India and now the US,A clear message is being sent to the international community: the UK is a fierce advocate of free and fair trade and a reliable partner with whom to do business,As one of our largest trading partners, a strong relationship with the US will always be welcomed by business to bolster our mutual competitiveness and kickstart growth,Today’s agreement must pave the way for deeper cooperation, making both of our economies prosper and grow,Helena Horton is a Guardian environment reporter.
The US-UK trade deal includes £5bn worth of agricultural exports.The farming sector in the UK has been very concerned about farmers being undercut with cheap products from the US, which has lower environmental standards for its food than the UK.They say the large beef feedlots in the US outcompete the smaller farms in the UK.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.
UK ministers have been clear that chlorinated chicken and hormone treated beef will not be included in any deal, but Rollins said she hopes to expand today’s agreement to include “all meats” and that she will 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.”Donald Trump, however, mentioned that US agriculture could end up being produced to higher health and environmental standards under the leadership of his health chief Robert F Kennedy, adding: “Bobby Kennedy is probably heading towards your system.”Department of Environment, Food and Rural Affairs sources said imports of hormone treated beef or chlorinated chicken will remain illegal, and that the deal will open up exclusive access for UK beef farmers to the US market.They said only a few countries such as Australia have this access.In the Commons Douglas Alexander, the trade minister, told MPs that he regarded the US-UK trade deal as a matter of “jobs saved”, not “job done”.
But he also said that, in getting a deal, Keir Starmer had succeeded where two previous Conservative PMs had failed.In response to calls for MPs to get a vote on the trade deal, Alexander confirmed there were no plans to change the current arrangements – which do not require a vote.He said that, despite claims that the deal would involve concessison on the digital services tax and on the Online Safety Act, neither of these things happened.In relation to the digital services tax, there is no change to the United Kingdom’s digital services tax as a consequence of the agreement that has been reached today.And I know that there has been widespread concern … in relation to measures tackling the evil of online harm