U.S. President Donald Trump and British Prime Minister Keir Starmer on Monday unveiled a new bilateral agreement to reduce tariffs on key UK exports, marking progress toward a broader trade deal between the two countries.
Signed on the sidelines of the G7 Summit in Canada, the agreement lowers tariffs on UK automobiles and aerospace goods, while reaffirming export quotas. However, disputes over steel and aluminium imports remain unresolved.
Trump hailed the relationship as fantastic, though he briefly mischaracterised the agreement as one with the European Union before clarifying it involved the United Kingdom. “We signed it and it’s done,” he said, holding up the signed document.
Starmer welcomed the deal as “a very good day for both of our countries” and a sign of strong bilateral ties.
The agreement eliminates tariffs on aerospace products, including UK aircraft and parts, and grants British carmakers an annual quota of 100,000 vehicles exported to the U.S. at a reduced 10% tariff, significantly lower than the 25% rate faced by other countries. The plan is set to take effect seven days after publication in the Federal Register.
While Britain avoided steel and aluminium tariffs of up to 50% imposed earlier this month on other countries, the U.S. will implement a quota system for UK imports of those metals, provided Britain meets conditions related to supply chain and production security. Commerce Secretary Howard Lutnick will determine the specific quota levels, the White House said.
The UK has agreed in return to lower tariffs on U.S. beef and ethanol and allow reciprocal access to 13,000 metric tons of American beef, provided it meets strict UK food safety standards.
UK Trade Secretary Jonathan Reynolds called the deal a major win, particularly for the UK’s aerospace and automotive industries. “We are delivering on the first set of agreements in a matter of weeks. And we won’t stop there,” he said, adding that further work was underway to secure trade protections for the pharmaceutical sector.
Trump, asked whether the agreement shielded Britain from future tariff threats, responded: “The UK is very well protected. You know why? Because I like them. That’s their ultimate protection.”