The UK government is hopeful of finalizing a significant trade deal with the United States by July 2025, with a particular focus on the steel and pharmaceutical sectors. This comes after the initial agreement reached earlier this year, which already eased tariffs on UK-made cars and aerospace products, bringing some relief to those industries. However, steel and pharmaceuticals remain unresolved areas, and the UK is keen to ensure these vital sectors also benefit from reduced trade barriers.
In the steel industry, the US had imposed a 25% tariff on imports from the UK, a protectionist measure that was lifted in the preliminary deal. Despite this progress, UK negotiators are pushing for full tariff exemptions on steel products, particularly for companies like Tata Steel. A sticking point has been the sourcing of some materials used in UK steel production, which partly come from abroad. The US wants clear assurances that steel exported to America meets their regulatory standards and originates in compliant ways, leading to ongoing discussions about how to satisfy these requirements without compromising UK businesses.
Pharmaceuticals are another priority in the talks. Both countries recognize the importance of the sector, which not only supports thousands of jobs but also plays a key role in innovation and public health. The UK is aiming to secure preferential treatment for its pharma exports to the US market, hoping to reduce costs and increase competitiveness for British companies. While both sides have expressed goodwill and a shared commitment to reaching an agreement, the precise terms remain under negotiation, with careful attention being paid to regulatory alignment and market access.
To push these negotiations forward, Prime Minister Keir Starmer has sent his senior business adviser, Varun Chandra, to Washington to engage directly with US officials. The UK government is optimistic that a comprehensive deal can be signed by the July deadline, which would not only strengthen the trade relationship between the two countries but also bring much-needed economic benefits to key British industries.
While the automotive and aerospace sectors have already started to feel the positive effects of the initial agreement, the steel and pharmaceutical industries are eagerly awaiting the outcome of these discussions. The success of these talks will be crucial for the UK’s future trade strategy and its ability to compete globally in these important fields.
