[LONDON/WASHINGTON] US President Donald Trump and British Prime Minister Keir Starmer on Thursday (May 9) announced a “breakthrough deal” on trade that leaves in place a 10 per cent tariff on goods imported from the UK while Britain agreed to lower its tariffs to 1.8 per cent from 5.1 per cent and provide greater access to US goods.

The agreement announced by Trump from the Oval Office marked the first since he triggered a global trade war with a barrage of levies on trading partners following his return to the White House in January.

“It opens up a tremendous market for us,” Trump said. “This is a really fantastic, historic day,” Starmer said by teleconference.

The US has been under pressure from investors to strike deals to de-escalate its tariff war after Trump’s often chaotic policymaking upended global trade with friends and foe alike, threatening to stoke inflation and start a recession.

Top US officials have engaged in a flurry of meetings with trading partners since the president on Apr 2 imposed a 10 per cent tariff on most countries, along with higher rates for many trading partners that were then suspended for 90 days.

The US has also imposed 25 per cent tariffs on autos, steel and aluminium, 25 per cent tariffs on Canada and Mexico, and 145 per cent tariffs on China. US and Chinese officials are due to hold talks in Switzerland on Saturday.

Warm relationship

With the British economy struggling to grow, the tariffs had added to the pressure on Starmer’s government.

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