Rubbernecking Trade: Trump's Pact with Starmer Sparks Cheers and Jeers
Trump and Starmer commemorate their initial major tariff agreement
In a whirlwind of celebration and controversy, US President Donald Trump and UK Prime Minister Keir Starmer have unveiled a sweeping trade agreement that promises to reshape the global economic landscape. This first major deal under Trump's presidency signifies a significant lowering of tariffs on goods, with Britain importing aircraft from Boeing and allowing duty-free imports of aircraft parts from Rolls-Royce.
At a press conference at the White House, an ebullient Trump heralded the agreement as a testament to his tariff policy, stating, "It's a very big deal." Despite Brussels' looming threat of counter-tariffs, Trump remains hopeful of securing a similar agreement with the EU.
Starmer, on the other hand, seemed invigorated, calling the deal "a truly fantastic, historic day." His approach of avoidance rather than confrontation with the US seems to have paid off.
However, this landmark agreement is hardly a typical free trade agreement. The deal covers specific areas, serving as a foundation for future negotiations.
Tires and Planes: A Crash Course in Trade Advantages
For the US, auto manufacturers stand to gain from the reduction of tariffs on British vehicles from 25% to 10% for the initial 100,000 vehicles exported to the US. Britain, on the other hand, will import aircraft worth around $10 billion (approx. $8.9 billion) from Boeing, while Rolls-Royce's aircraft parts can enter the US duty-free. Additionally, Britain will slash its tariffs on US goods from 5.1% to 1.8%. British steel and aluminum tariffs will be abolished entirely.
Despite the UK's significant exports to the US totaling approximately $370 billion last year, only about 30% of these were goods, the remainder being services, which are tariff-exempt.
An Old Friend or a New Adversary?
The US-UK trade deal could signal a shift in allegiances, as Starmer maneuvers diplomatic waters skillfully. On the other hand, Brussels remains resolute, threatening Trump with blanket tariffs of 25% if negotiations with the US do not progress. The deadline is set for July. Despite an offer from Brussels to mutually abolish tariffs on industrial goods, the Trump administration has yet to respond.
Starmer's Labour Party is under intense political pressure, mirroring the public's diminishing support for Trump in the US.
In a surprising twist, the EU Commission is preparing new counter-tariffs on US exports worth up to $115 billion, potentially affecting a wide range of products, from machinery and agricultural goods to cars, whiskey, and more. The Commission is also planning to take legal action against the US at the WTO.
Meanwhile, the US and China are set to hold high-level trade talks this week, with the UK-EU summit looming on May 19.
Amidst the geopolitical chessboard, one thing remains clear: the US-UK agreement marks only the beginning of a rapidly evolving trade landscape.
- References:
- ntv.de
- as/dpa/rts
- Related Topics:
- United States
- United Kingdom
- Donald Trump
- Keir Starmer
- Tariffs
- European Union
- Trade Deals
- Automobiles
- Aerospace
- Steel and Aluminum
- Economy
- The US-UK trade agreement, underlined by a significant lowering of tariffs on goods, includes a commitment to import aircraft worth around $10 billion from Boeing, a move praised in President Trump's employment policy.
- In addition to aircraft imports, the employment policy of rolling back tariffs extends to Rolls-Royce as well, enabling duty-free imports of aircraft parts.
- As Parliament prepares for discussions on the deal, part of the general-news agenda, the Labour Party is reportedly under pressure as the public's view aligns with dwindling support for Trump in the US.
- In the realm of politics, the EU Commission has announced new counter-tariffs on US exports, worth up to $115 billion, in preparation for a potential legal challenge at the WTO, amidst ongoing tariff discussions with the US.
