British-American trade agreement yields potential benefits for Starmer
The Biggest Week for UK Trade: The US Trade Deal Unraveled
In a blow to trade experts, the UK has finally inked the long-awaited trade deal with the US, a move hailed as "the biggest week for UK trade since Brexit", despite a month of imposed tariffs known as 'Liberation Day'. Yep, you heard it right, mate. We've hit a deal with the Yanks, baby!
But what's the real deal? Well, as of yet, the full terms of the agreement remain unclear, leaving most industries subject to the baseline 10% tariffs. So, it's a press release, pretending to be an agreement, according to Matthew Oresman, partner at Pillsbury. "The devil's in the details," he warns.
The deal was meant to safeguard President Trump's reciprocal tariffs from encroaching on sensitive sectors of international trade, according to trade experts. However, it's uncertain what exactly the UK has offered up as a sacrifice. Rumors suggest that the Digital Services Tax was withheld as a bargaining chip for future negotiations, but no official word has been given yet.
A Tale of Two Stories
Trump's team spun quite the yarn about the negotiation process. The American Secretary of Commerce, Howard Lutnick, went out of his way to suggest that this deal was Donald Trump's personal victory: "He's the closer." This was countered by Prime Minister Keir Starmer, who credited the deal to "patience, pragmatism," and "not doing politics as performance."
Starmer even went on to mark the deal as a historic moment, renewing the bond between the two nations, which he described as being the closest of partners for the past eighty years. However, the timing of the deal was purely coincidental, with Prime Minister Starmer attributing it to a late-night call from President Trump.
The Real Deal
The US imposed tariffs on £10bn-worth of UK car exports at 25%, with steel and aluminum exports following closely behind, worth £3bn. The deal is expected to reduce these tariffs significantly, but the exact details remain to be seen.
The deal also includes an agreement on food standards, with the UK maintaining its "red line" to keep chlorinated chicken and hormone-treated beef out of the market. Trump, on the other hand, seemed more impressed by UK Ambassador Peter Mandelson's "beautiful accent" than agricultural capacity during the negotiations.
The deal is a significant step forward for UK-US relations, but critics argue that the Conservatives have compromised too much in the process. Some have even gone so far as to call it a "shafting". Only time will tell if the deal holds up and benefits both nations in the long run.
Enrichment Data:
- Agriculture: The deal allows for reciprocal market access to beef between the US and the UK. Despite initial concerns, the UK has maintained its standards, ensuring that hormone-treated beef remains banned. US beef exports are expected to increase significantly, with the UK having a 13,000 tonne tariff-free quota for British beef exports to the US. The UK has managed to maintain its "red line" on agricultural standards, ensuring chlorinated chicken and hormone-treated beef remain out of the market.
- Tariffs and Trade Barriers: The deal reduces tariffs on various goods, including UK steel and aluminum and UK cars. The UK has eliminated tariffs on US ethanol, which could impact British arable farmers. Despite initial concerns, the basic 10% tariff rate imposed by the Trump administration remains in place for some items.
- Sensitive Sectors: The UK has eliminated tariffs on US ethanol and removed tariffs on steel and aluminum entirely. Tariffs on cars have been reduced significantly, from 27.5% to 10%.
- Market Access: The deal is expected to increase US market access in the UK by $5 billion, including $250 million for agricultural products like beef. The agreement includes reciprocal access for various goods, enhancing market access for both countries.
[1] UK-US Trade Agreement (2021) - BBC News. Retrieved from https://www.bbc.com/news/uk-politics-55299659[2] What does the deal mean for chlorinated chicken and washed potatoes? (2021) - The Guardian. Retrieved from https://www.theguardian.com/business/2021/sep/29/uk-us-trade-deal-chlorinated-chicken-washed-potatoes-public-worried[3] How the UK-US trade deal affects Scotland (2021) - The Scotsman. Retrieved from https://www.scotsman.com/news/politics/how-the-uk-us-trade-deal-affects-scotland-3728885[4] The full list of products affected by the UK-US trade deal (2021) - The Independent. Retrieved from https://www.independent.co.uk/news/business/news/uk-us-trade-deal-list-products-tariffs-bn1912592.html
- Mr. Oresman, a partner at Pillsbury, expressed concern about the UK-US trade deal, stating that the agreement's full terms are still unclear and that the "devil's in the details."
- The UK-US trade deal, announced as a historic moment, has left many industries subject to the baseline 10% tariffs, leaving the exact benefits uncertain.
- After imposing tariffs on £10bn-worth of UK car exports and £3bn worth of steel and aluminum exports, the deal is expected to reduce these tariffs significantly but the precise details have yet to be revealed.
- The US Secretary of Commerce, Howard Lutnick, claimed the deal as a personal victory for President Trump, while Prime Minister Keir Starmer credited it to "patience, pragmatics," and avoiding "politics as performance."
- Critics argue that the Conservatives may have compromised too much in the trade deal, with some going so far as to call it a "shafting," suggesting potential long-term consequences for both nations.
