Keir Starmer and Donald Trump hail ‘historic day’ as UK and US finally agree trade deal

The Labour leader hailed the conclusion of a US-UK trade agreement as a “fantastic, historic day”, that would save British jobs, boost business, and leave the UK in a stronger position.

The US President said the agreement was a “great deal for both countries”, but conceded it was still being “written up”.

Ministers had been pursuing a deal with the US to reduce the impact of sweeping tariffs imposed by Mr Trump last month, which placed a 10 per cent levy on all UK exports and a 25 per cent charge on steel, aluminium and cars.

Deputy First Minister Kate Forbes said there were concerns which “still need to be addressed” and that it was “disappointing” the Scottish Government and other devolved administrations had not been told “that this trade deal was imminent, let alone consulted on its content”.

The US President outlined the framework of the deal in a phone call with the Labour leader from the Oval Office.

He said: "Today's agreement with the UK is the first in a series of agreements on trade that my administration has been negotiating over the past four weeks.

"With this deal, the UK joins the United States in affirming that reciprocity and fairness is an essential and vital principle of international trade.

“That’s the first of its kind. So we have a big economic security blanket and that’s very important and we feel very, very comfortable with that, because it’s been a great ally.

“Both countries have agreed that the economic security is national security, and we’ll be working together as allies to ensure that we have a strong industrial base, appropriate export controls and protections for key technologies and industries like steel.”

The timing and manner of the announcement came as a surprise to both UK ministers and many in the states, with the president not afforded unilateral authority to enter into trade agreements, and needing Congress approval to confirm them.

Under the deal, American tariffs on British cars fall to 10 per cent for the first 100,000 vehicles exported to the US, while tariffs on steel are scrapped.

Steel union Community’s assistant general secretary Alasdair McDiarmid suggested the deal would protect jobs in the industry.

He said: “The UK Government deserves enormous credit for negotiating this deal to reduce US tariffs which would have had a hugely damaging impact on our steel sector.”

In exchange, the UK has reduced tariffs on US products including beef and ethanol, which US commerce secretary Howard Lutnick said would create 5 billion dollars in “opportunity for American exports”.

The agreement on beef provides a tariff-free quota for 13,000 tonnes of US exports, but the UK Government said this would involve no reduction in food standards.

Mr Lutnick added that British-made Rolls Royce engines would be excluded from tariffs, with a UK airline agreeing to buy “10 billion worth of Boeing planes later today”.

Mr Trump said the UK would also be brought into “economic security alignment” with the US as a result of the deal.

Number 10 said work would continue on pharmaceuticals and remaining tariffs, but the US had promised to give the UK preferential treatment if any further tariffs were imposed.

The Labour leader had deployed a charm offensive with the US President, inviting him for a second-state visit, and repeatedly arguing the UK did not have to choose between closes ties with Europe or the US.

Mr Trump explained the "final details are being written up", but that "just about everything has been approved".

He said US chemical, machinery and "industrial" companies will be getting improved access to UK markets, and that the UK was “right at the top” of the US’s allies.

There was also praise for the Labour leader, calling him "terrific" and saying the two countries have a "great relationship".

Responding, the Prime Minister said it was a “really important deal”. He said: “This is going to boost trade between and across our countries.

“It’s going to not only protect jobs, but create jobs, opening market access, and as you say, Donald, the timing couldn’t be more apt, because not only was it 80 years ago today, victory came for Europe after and at the end of the Second World War but of course, on that day, the UK and the US stood together as the closest of allies.”

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The Government had been pursuing a deal with the US to reduce the impact of sweeping tariffs imposed by Mr Trump last month, which placed a 10 per cent levy on all UK exports and a 25 per cent charge on steel, aluminium and cars.

Ministers are expected to update MPs on talks with the US with a statement in the Commons later on Thursday.

Number 10 had been expecting the announcement of a deal, but the timing of Mr Trump’s post came as a surprise, given the focus on VE Day commemorations. It meant ministers were in the dark about what exactly Mr Trump was announcing.

The deal with the UK will be the first agreement since Mr Trump announced the “liberation day” tariffs on countries around the world on April 2.

Reports have previously suggested a deal could see the UK reduce some tariffs on American products, as well as changing the digital services tax that currently affects mainly US tech companies.

But the Government has ruled out lowering food standards to allow more US agricultural products into the country, or watering down the Online Safety Act, which some in America regard as placing restrictions on freedom of speech.

It follows a UK-India agreement being announced, that is estimated to bring in a £25.5bn boost to bilateral trade and a £4.8bn annual increase in UK GDP. The deal simplifies exports of UK goods to India and cuts taxes on Indian clothing and footwear exports.

Previous speculation had suggested the UK would revise the digital services tax as part of a deal, with the levy mainly applying to US tech companies.

But Number 10 said on Thursday the tax would remain unchanged, with the two countries agreeing to work on a separate digital trade deal that would reduce paperwork for British firms exporting to the US.

Conservative leader Kemi Badenoch claimed that the UK has been “shafted” by the Government’s deal with the US.

In a post on X, Mrs Badenoch said: “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!”

Ms Forbes said “urgent clarity” was needed on what the deal could mean for the import of food and agricultural produce from America, going on to say that a “number of trade-related concerns still need to be addressed”.

She added: “In particular, we will be seeking urgent clarity on what the deal means for imports of US food and agricultural products.

“We have always said that unilateral trade barriers are not the answer to global trade issues and so I obviously welcome the fact that some barriers will now be reduced.”

Scotland’s salmon sector called for further negotiations as the product will still be subject to a 10 per cent tariff on US sales.

Tavish Scott, chief executive of Salmon Scotland, said: “Scottish salmon is enjoyed in 50 countries worldwide, and we welcome strong trading relationships with overseas markets.

“However, the 10 per cent tariff on exports to the US remains a barrier, and we want to see it removed.”

He added: “Today’s US-UK deal should be seen as a staging post – not the destination – on the path to reducing trade barriers, securing jobs in Scotland, and driving economic growth.”