LONDON — Sporting a bow tie under the gold filigree ceiling of London’s 18th century Mansion House, Britain’s Jonathan Reynolds was in a good mood.
Britain and India had sealed a (highly controversial) trade deal the previous day, and a pact with the U.S. seemed near. “This is not an easy time to be a trade minister,” the business and trade secretary told a banquet of ambassadors and business elite Wednesday night. “Weeks happen in hours.”
He did not realize how right he was. At almost the exact minute Reynolds began his speech at 9:24 p.m., Keir Starmer took a surprise call from Donald Trump. The U.S. president had interrupted the second half of a football match between the prime minister’s team Arsenal and Paris Saint-Germain, which he was watching on TV in his Downing Street flat.
Trump made an “11th-hour intervention … demanding even more out of this deal than any of us expected,” U.K. Ambassador to the U.S. Peter Mandelson revealed Thursday in the Oval Office, where Trump gripped his hand.
Trump asked Starmer to cut U.K. tariffs on American ethanol and pork, said three people familiar with the details. Like other officials quoted in this piece, they spoke on condition of anonymity.
Yet after another call to Reynolds from his negotiating team — which he took while still in a Mansion House drawing room — the deal was sealed.
Britain agreed to Trump’s demand on ethanol, but not on pork. The two leaders appeared on split-screen speakerphone calls Thursday to announce the U.S.’s first bilateral carve-out deal from sweeping tariffs that Trump announced on Apr. 2.
The made-for-TV pact was announced with Trumpian bombast on the 80th anniversary of VE Day, prompting Starmer to redraw his carefully-laid schedule and visit a Jaguar Land Rover plant. So last-minute was the trip that Downing Street accidentally invited journalists to the wrong car factory.
The deal will cut tariffs from 27.5 to 10 percent for 100,000 U.S.-bound British cars per year and slash 25 percent tariffs on British steel and aluminum to zero, while allowing 13,000 tons of U.S. beef to enter the U.K. tariff-free. White House demands for Britain to water down a digital services tax on technology giants came to nothing — for now, at least. (Work will soon begin on a further technology partnership).
Never mind that the terms are still worse than those Britain enjoyed before Trump’s “Liberation Day,” or that the president — hit by a domestic backlash to his tariffs — was under pressure to announce a deal, any deal. Nor that questions are yet to be answered, and that opposition MPs are already demanding a full vote on the deal.
It left Starmer jubilant. The prime minister said it proved “performative politics” were not the answer, while allies hailed victory for his “warm relations, cool heads” strategy — a months-long buttering-up of the president that began in earnest when Starmer handed Trump an invitation to a state visit in the Oval Office in February.
Nine years ago, Barack Obama said Brexit would put Britain at the “back of the queue” for a U.S. trade deal. On Thursday Britain was at the front of that queue — although notably not for a full free trade agreement — and Trump said it had “Brexit in particular” to thank.
“Normally after Arsenal lose you don’t see him grinning the next morning,” one No. 10 official said of Starmer Thursday. “But he was definitely grinning this morning.”
Weeks in the negotiating tunnel
While the details went down to the wire, most of the deal was finalized on the U.K. side this week by three organizations: Downing Street, the Department for Business and Trade (DBT) and the British Embassy in Washington.
The softly-softly push came from across the government, including Chancellor Rachel Reeves, who made her case to U.S. Treasury Secretary Scott Bessent on Apr. 25. But the DBT and embassy led the show, in weeks of talks where — at times — only about half a dozen people were fully in the loop.
Industry figures suspected something was afoot on Apr. 30, when senior figures — including Bryant Trick, assistant U.S. trade representative, and Graham Floater, the DBT’s director for U.S. trade — failed to show at a dialogue for the two nations’ small and medium-sized businesses in Charlotte, North Carolina.
Officially the reason was a transport hiccup, but one person with knowledge of the meeting said: “I thought it was one of the signs that significant progress was being made. It really, really tightened up over the last couple of weeks.”
Several people said a key figure in sealing the deal was civil servant Amanda Brooks, the DBT director general for trade negotiations. She was visibly buzzing in a red dress at Wednesday’s Mansion House gala — speaking in excited but hushed tones to the business elite — after working on the deals with India and the U.S. at the same time.
“She is the engine room of DBT’s trade negotiations,” said one industry figure. A second added: “Amanda is a very cool operator. She of course was having to multitask to get the India agreement over the line as well.”
Another figure at the center of negotiations was Varun Chandra, the former boss of the secretive advisory firm Hakluyt who is now Starmer’s business adviser in No. 10. Chandra was in regular contact with U.S. Commerce Secretary Howard Lutnick and U.S. Trade Representative Jamieson Greer, as was Reynolds. The Guardian reported that Chandra was in the U.S. to seal the deal this week.
Mandelson — who flanked Trump in the Oval Office Thursday along with Mungo Woodifield, the British Embassy’s minister counsellor for trade — was also at the center of talks. The smooth-talking operator from the days of Tony Blair’s government asked business groups in private what he could offer the U.S., and used his lavish residence to full effect, hosting three parties in four days over the White House correspondents’ weekend.
Something, somewhere must have worked.
When the USTR’s team spoke to British industry groups in March, the U.S. appeared to have three priorities, said the first industry figure quoted above — the digital services tax, carve-outs from the U.K.’s 20 percent Value Added Tax rate, and some agreement on agricultural exports. Britain offered nothing on the first two in the deal, although agrifood became “probably the top” U.S. ask in the last month, the second industry figure said.
U.S. officials also began by saying the “U.K. has a trade deficit with the U.S. and it needs to be rectified. The language softened on that point, where it became more ‘we’re equals and there’s not so much of a problem to be dealt with,’” the industry figure said. “That change in messaging is probably a reflection that the U.K. team were doing a really good job on working on the White House and trying to put the U.K. in a better light.”
But Britain cannot solely thank itself. Trump was also suffering a domestic backlash to his wave of tariffs, putting him under pressure to telegraph some movement on trade talks amid fears that empty ports on the country’s West Coast will soon translate to reduced supply and higher prices on shelves. The shift in U.S. position was partly due to “pressure Trump was feeling on some of the economic issues,” conceded the first industry figure quoted above.
The president has also been eager to telegraph strength and notch a win before he departs next week for the Middle East, in what was supposed to be the first foreign trip of his second term before Pope Francis’ funeral was scheduled late last month.
The special relationship
Nonetheless Britain still managed to insert itself — rather than another ally — at the moment the president needed that deal.
Starmer spent their Feb. 27 meeting in the Oval Office careful to lavish praise on Trump, and after their White House meeting the president returned the favor. “You are a very tough negotiator,” Trump told him.
It is the same tactic Starmer has employed on the Russia-Ukraine war, where he picked up the phone to Trump and Ukrainian President Volodymyr Zelenskyy after their clash in the Oval Office, instead of condemning the scene online.
Critics and opposition MPs say this is a sign of weakness, and that the PM should be more robust in public with the president, like Canada’s new PM Mark Carney. Starmer’s backers insist it has paid off, with Ukraine and the U.S. reaching a minerals deal, though a Ukraine-Russia peace deal still looks some way off.
All this is while Starmer struggles with tanking poll ratings and the rapid rise of Nigel Farage’s right-wing party Reform UK. The second industry figure above said: “Generally I think the government are playing a blinder internationally at the moment. Domestic, a bit more difficult.”
Officials insisted Britain was clear on its red lines in private — namely that American food imported into the U.K. would have to meet British rules, and that it needed help for Britain’s stricken car sector and steel industry. One MP who spoke to car industry executives in recent weeks warned the 25 percent tariffs were “existential.” Officials were also on alert not to water down rules on pharmaceutical products coming into the U.K.
Mandelson told POLITICO: “I am very happy with the outcome. We have secured all our main asks and the agreement will now open the door to a deeper long-term U.K.-U.S. technology partnership.”
Now for the details
For all the jubilation, the deal still has a long time to potentially unravel.
Starmer tacitly accepted that tariffs on U.K. exports to the U.S. were still higher than in the Biden era. “The question you should be asking is, is it better than where we were yesterday?” he told a reporter.
Kemi Badenoch, leader of the opposition Conservative Party, said: “We cut our tariffs — America tripled theirs … we’ve just been shafted!”
Starmer’s rural MPs, still smarting from the blowback over cuts to inheritance tax relief for farmers, had been on high alert as news leaked of agri concessions, but helpful statements from the National Farmers Union following the announcement calmed nerves. “The NFU is content with this deal, hormone beef and chlorinated chicken are still banned and SPS standards upheld. So that makes my worries melt away,” one MP said.
The NFU did, however, raise concerns about the decision to slash tariffs on U.S. exports of ethanol. And U.S. Agriculture Secretary Brooke Rollins said the deal would “exponentially increase our beef exports,” despite U.K. officials insisting standards would be upheld. The details will be studied closely.
Many other questions will only be answered later, after Trump accepted the final details are only being “written up in the coming weeks.”
MPs will not get a vote on the whole deal, even though some individual measures will be voted on as a part of the current U.K. process to ratify trade agreements.
The Liberal Democrats have already demanded a full vote, while Conservative MP John Whittingdale said: “Parliament should not just debate but vote on a U.S. trade agreement. Not least as I will want to be sure that we are not surrendering vital measures such as IP protection, the Digital Markets Act and the Online Safety Act in order to get a deal.”
Reynolds insisted Thursday that Britain’s legislation on digital services taxes and online safety had not been touched. But it was not immediately clear that they would remain untouched in future talks on tech co-operation.
“Everything’s on the table,” said one U.K. official, asked about the digital services tax. “If it’s something fantastically attractive … if the sum that goes into the deal outweighs what goes with the digital services tax, then let’s do it.”
Mandelson said in the Oval Office that Thursday’s deal will be “the end just at the beginning.” He may be right in more ways than one. Starmer for now is savoring a hard-won victory, but on the Trump rollercoaster, there will be many more ups and downs to come.
Annabelle Dickson and Noah Keate contributed reporting.
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