Trade deal: This is how UK exports to US returned to growth in May
UK exports to the US returned to growth in May after the two countries agreed a trade deal that softened the blow of President Donald Trump’s tariff increases.
Goods exports rose by £300m during the month, the Office for National Statistics (ONS) revealed.
This followed a steep drop in April when exports declined by £2bn, the largest monthly decrease since records began in 1997.
The value of goods shipped across to the US nonetheless remained relatively low in May, the ONS said.
A UK-US trade deal, announced on May 8, included lowering tariff rates on UK car exports to the US and removing tariffs on UK steel, aluminium and goods within the aerospace sector such as engines and aircraft parts.
The agreement was welcomed by industry groups following fears that some sectors would be hammered by the higher levies.
All other goods nonetheless will be subject to a 10 per cent blanket tariff, brought in during Mr Trump’s “liberation day” announcements in April.
The US president is stepping up pressure on countries who could soon be subject to higher tariffs, urging them to negotiate trade deals with the US before an extended August 1 deadline.
May’s increase in exports to the US was due to a rise in chemical shipments, according to the ONS.
Meanwhile, imports of goods from the US to the UK fell by £900m in May because of falls in gas and crude oil and ships and aircraft.
The overall value of exports from the UK increased by 2.2 per cent in May, at £600m, with increases both to EU and non-EU countries.
Nevertheless, the total goods and services trade deficit widened by £6.7bn to £13.2bn in the three months to May, because of a large rise in goods imports and a fall in goods exports.
William Bain, Head of Trade Policy at the British Chambers of Commerce, said: “UK trade showed signed of stabilising in May as the initial impact of higher US tariffs began to subside.
“Services exports and imports showed steady month on month growth of 0.5 per cent. Goods exports volumes also rose by 3.1 per cent, with 4.2 per cent growth to the EU, and 1.9 per cent to the rest of the world.
He added: “Goods exports to the US rose by £0.3bn in May after a rollercoaster few months, but export levels are still significantly below where they were six months ago.
“More predictable tariff and trading conditions are key to providing our businesses with certainty.
"Further implementation of the UK-US deal would enhance those prospects, together with successful negotiations with the EU, and stronger export performance in the Indo-Pacific region.
"This should include the opportunities of enhanced trade with the CPTPP (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) states and ratification of the trade deal with India.
“If this is combined with a full rollout of the policies from the recent UK Trade Strategy, then businesses will be given the confidence needed to invest and grow their global trade links throughout 2025 and beyond.”
The British Chambers of Commerce represents a network of 51 chambers across the UK.