UK-US trade deal: ‘Donald Trump needed this almost as much as Starmer’
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A trade deal between the UK and US has been announced, with Donald Trump and Keir Starmer describing it as “historic” – but sharing very little of the details. But which country needs this deal the most, and why on VE Day?
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In brief:
- President Trump and PM Starmer announced a "historic" trade deal today (May 8), though it's not the "full and comprehensive" deal initially promised, focusing instead on specific sectors like agriculture, chemicals, and a limited quota for UK car exports.
- Both leaders praised each other warmly during the announcement, with Trump calling it an "honor" to work with Starmer and Starmer describing the deal as a "testament" to Trump's leadership.
- The deal may benefit both leaders politically - giving Trump a diplomatic win amid economic concerns over his tariff policies, while providing Starmer with a tangible achievement to counter criticism he’s faced around winter fuel payment cuts.
What’s the story?
For years the US and UK have been working on a trade deal that never materialised, until today (8 May).
President Trump and Prime Minister Starmer spoke on the phone to announce what both called a “historic” deal - and the tone couldn’t have been warmer, with Starmer repeatedly referring to the President as “Donald” and each complimenting the other for making the deal happen.
Trump said it has been an “honour” doing business with Starmer, praising him as “terrific”. Starmer said the deal was a “testament” to Trump’s leadership.
But the “historic deal” both leaders are so proud of is not the “full and comprehensive” one that Trump promised when he announced it on social media earlier in the day.
In the press conference, Trump mentioned that the deal will involve billions of dollars of American exports including American beef, ethanol, and other agricultural products, and that the UK will be “fast tracking American goods through their customs” removing any “red tape”.
Other details (and there weren’t many) included adding American chemicals and machinery into the deal, and “bringing the UK into economic security alignment with the US”.
It has been agreed that the UK will be able to send 100,000 cars into the US on the original 10% baseline tariff, US Secretary of Commerce Howard Lutnick announced. Rolls Royce engines and parts for aeroplanes can be exported from the UK to the US tariff free, he says.
Starmer said the deal will “boost trade” and “not just protect jobs, but create jobs”.
This is the first trade deal the US has made in the Trump presidency, although Trump has said there are more meetings on the agenda, as “everybody wants to be making deals real badly”.
What’s The News Agents’ take?
The trade deal was announced during a press conference, which Jon Sopel describes as a “love in” between Trump and Starmer as both “lavished praise on one another.”
“But the devil is always in the detail,” he adds. “
And what we know so far is a broad picture, not the detail.”
That detail might not matter so much for Donald Trump, who is more concerned with optics, Lewis Goodall says.
“He's able to point to and say; ‘look the leverage that I extracted, that I imposed on the UK worked, and this is going to be the first of many other countries that are knocking on my door begging me to get a better deal’.”
Emily Maitlis says it is no coincidence that the trade deal was announced on VE Day, as the UK and Europe marked 80 years since the end of the Second World War.
“Trump has basically managed to insert himself into a glorious bit of world history,” she says.
“What he's trying to say is: 'I stood shoulder to shoulder with Europe then, I'm standing shoulder to shoulder with Keir Starmer now'.
“Trump is the ultimate showman – not statesman, but showman – and he's inserted himself into this day in a way that makes him impossible to ignore.”
She adds that it’s not just Trump who benefits from the timing of today’s announcement, it’s a much-needed bump for Starmer’s role as PM, having been criticised for cuts to the winter fuel allowance and disability allowance.“
This is something tangible. It's visceral,” Emily says.
“He can say this is a vindication of all that pandering around with the King's letter sitting by Trump's side – it's working now.”
But of course, any trade deal secured will still leave the UK in a worse place than it was before Trump imposed his tariffs.
“This is a deal which will be focussed on specific sectors, which if anything, you could argue, is a deal which mops up some of the worst things that Trump himself did a few weeks ago with his tariffs,” Lewis says.
The self-harm that Trump caused with his own tariff policies, turned out to be an unexpected benefit for Britain, Jon argues.
“Ever since Brexit, I've been arguing that a free trade deal, or a trade deal with the UK, will be conducted on America's terms. I have consistently argued that America holds all the cards.”
“Actually, in the past month, I've changed my mind on that, because I think that Donald Trump has done so much damage to his own reputation within America, his plummeting poll numbers, the reaction of the markets, what's happened on the bond markets, the dollar as well, that Donald Trump needed this.
“Donald Trump needed this almost as much as Keir Starmer did.”
Listen to the latest episode of The News Agents.
