Wafric News – May 9, 2025

Washington, D.C. — In a significant turn for transatlantic economic relations, U.S. President Donald Trump on Thursday announced the outline of a new trade framework between the United States and the United Kingdom—marking Washington’s first major bilateral step since the partial suspension of its controversial “Liberation Day” tariffs.

While the full details of the pact remain under negotiation, the framework sets the tone for a broader, long-term agreement. It includes tariff reductions and expanded market access that could reshape trade flows between the two allies.

Under the preliminary terms, the U.S. will reduce tariffs on British cars, lowering the current 25% rate to 10% for the first 100,000 vehicles exported to the U.S. annually. Steel and aluminum duties will also be recalibrated, though the 10% blanket tariff on a broad range of imports remains in effect for most other nations.

In return, the United Kingdom has agreed to ease import restrictions on several American goods—including ethanol, beef, and industrial machinery—offering what U.S. officials estimate to be $5 billion in additional market opportunities.

Additionally, the deal secures a $10 billion order for Boeing aircraft components and establishes a priority supply chain arrangement for U.S. pharmaceuticals entering the U.K. British customs will also implement fast-track clearance for American imports, according to statements from the White House.

"This is a win-win," Trump said during a press briefing in the Oval Office. "It’s working out great for both countries, and the final details are being written up."

Joining by phone, U.K. Prime Minister Keir Starmer praised the progress of the negotiations, calling the agreement “an important step forward.” He emphasized the closeness of U.S.-U.K. relations and expressed confidence that remaining issues would be resolved soon.

“There are no two countries closer than ours,” Starmer remarked. “This deal reflects that partnership. There’s still work to do, but we’re getting there.”

Last year, the U.K. accounted for about 2% of total U.S. imports, with nearly $68 billion in goods shipped to American shores. The U.S., by contrast, exported roughly $80 billion to the U.K., representing about 4% of its total exports.

This framework comes as the U.S. engages in simultaneous trade talks with 17 of its 18 top partners, excluding China. Treasury Secretary Scott Bessent confirmed that the administration is actively pursuing agreements across the globe, while holding off on a wave of “reciprocal tariffs” set to resume in July.

Talks with China remain tense. The U.S. recently imposed a 145% tariff on Chinese goods, prompting retaliatory action from Beijing at 125%. Bessent is expected to travel to Geneva for preliminary discussions this weekend.

Commenting on those developments, Trump signaled a willingness to de-escalate. “You know it’s coming down,” he said of the China tariffs. “It couldn’t go higher.”

However, the tariff strategy has drawn criticism from economists and central bankers alike. Federal Reserve Chair Jerome Powell, speaking in Washington on Wednesday, warned that sustained high tariffs could accelerate inflation and hamper economic growth.

“If the large increase in tariffs that have been announced are sustained, they’re likely to generate a rise in inflation and a slowdown of economic growth,” Powell cautioned.

Despite these risks, Powell noted that key indicators still show the U.S. economy remains in “solid shape.”

As Washington presses ahead with its new bilateral push, the U.S.-U.K. framework may serve as a template for future deals—a blend of strategic alignment and economic pragmatism in a time of global uncertainty.


By WafricNews Desk.