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It has only been a few weeks since the United Kingdom agreed to a trade deal with the United States that exempted them from the worst of President Trump’s tariffs. There was a grand, if slightly awkward, ceremony in the White House. The deal was sold as a triumph of negotiation and diplomacy for the Prime Minister Sir Keir Starmer, and even more for our ambassador in Washington, Lord Peter Mandelson.
But it seems Starmer may have got ahead of himself, for this deal appears to only have been a temporary truce. Right now there is a real risk that the government may blow the deal – and that would be hugely embarrassing for the Prime Minister indeed.
With President Trump’s 50 percent tariffs on imports of steel and aluminum into the United States coming into force Wednesday, the UK can be even more grateful for its separate deal. Britain has been granted an exemption from the levies – at least for now. There is just one catch. It has now emerged the UK has only five weeks to get a permanent deal over the line or face the same tariffs on steel, alongside potentially many other products as well.
And yet, Starmer’s government does not appear to have made much progress on its side of the bargain. Last month’s deal was contingent on Britain reassuring Americans about Chinese ownership of their few remaining steel plants, but very little appears to have been done to clarify that. Given that the UK’s industrial power prices are out of control, and its green targets are some of the strictest in the world, it is unlikely that anyone else wants to make steel there. Meanwhile, the government is too broke to take the plants into state ownership.
Five weeks is not very long to get any of those issues resolved
The UK is also meant to be easing restrictions on imports of American beef, along with ethanol and a range of other agricultural products. And yet, there is little sign of anything being done about this. No doubt, the government is trying to delay the fierce resistance from farmers and green lobbies it will experience as a result.
Even worse, since the signing ceremony in the White House, the UK has signed a “reset” agreement with the EU that will make it far harder to reach a deal with the US. Britain is aligning its food standards with Europe, which will make it much more challenging to open up their market to American imports. It would be hard to blame officials in Brussels for making it harder for the UK to tie up the deal with Washington; it would be far better to have the UK as collateral damage in a trade war across the Atlantic.
Five weeks is not very long to get any of those issues resolved. By the middle of the summer, the UK’s trade deal with President Trump may well have fallen apart. The Starmer government will only have itself to blame if that happens – and it will prove a humiliating reversal of fortune.
