United States, United Kingdom Reach Agreement On Trade Deal Framework

The United States and United Kingdom (U.K.) have reached an agreement to reduce trade barriers. The full details of the agreement are still being written, but President Donald Trump said they will be put down on paper “in the coming weeks.”

Based on a White House fact sheet and reporting in the media, we do know the agreement will:

• Remove the United States’s Section 232 25 percent tariffs on U.K. steel and aluminum exports to the United States. It is not yet clear whether this provision will apply to steel and aluminum derivative products and or whether it will apply only industrial metals melted and poured in the U.K. The White House fact sheet also said the trade agreement “creates a new trading union for steel and aluminum.” (Again, no other details are available.)
• Maintain the universal 10 percent tariff on U.K. imports while lowering the tariffs on autos from 27.5 percent to 10 percent. That lower tariff rate will apply to a quota of 100,000 vehicles.
• Offer the United States new access to U.K. markets for exports of beef, ethanol, machinery, and other industrial goods.

Again, this deal is preliminary. As several news outlets have reported, officials from both the U.S. and U.K. governments said they still need to meet in the coming months to hammer out specific language. That fact means the policies outlined above are not yet in effect and that, ultimately, the parties may not reach agreement on a formal trade pact.

Still, there is motivation to act. The U.K. is the fifth-largest market for U.S.-manufactured goods exports. In 2024 alone, U.S. manufacturers exported $61.6 billion in manufactured goods to the United Kingdom. Additionally, $58 billion in critical inputs — including automotive parts and construction machinery — are imported from the U.K. to the United States.