A Cabinet minister flatly rejected as “complete nonsense” a report that America will have a veto over Chinese investment in Britain under the trade deal agreed by Donald Trump and Sir Keir Starmer.
Darren Jones, Chief Secretary to the Treasury, denied there would be any such clause in the agreement unveiled by the US president and the Prime Minister on Thursday in a live phone call.
“This story on the front page of the Telegraph is complete nonsense. I mean, I’m at a bit of a loss as to know where it’s come from. I think it was a Conservative Party criticism,” he told Times Radio.
“But as you said, we’ve not even published all of the documents yet, so I’m not quite sure how they were able to come up with that.
“I can be completely categorical with you there is no such thing as a veto on Chinese investment in this trade deal.”
The White House read-out of the trade deal states: “Both countries intend to strengthen cooperation on economic security, including by coordinating to address non-market policies of third countries.”
This is understood to focus on exports from the UK to the US rather than the wider British economy, so that the deal does not allow the circumvention of measures put in place in America on trade and security in relation to countries such as China.
But the Telegraph reported Government sources saying that Washington would be able to raise concerns about Chinese companies buying up key infrastructure, which could spark action under the UK’s National Security and Investment Act.
A source close to the talks told the newspaper that the agreement amounted to a “sort of veto” for the US on “major China investment”.
Shadow foreign secretary Dame Priti Patel said: “Starmer has already given Trump a bigger UK tariff cut than Trump has given him.
“Now it looks like he’s efectively handed America a veto over investment decisions in the UK.”
As part of the agreement, US import taxes which had threatened to cripple British high-end carmakers were cut from 27.5% to 10%, while the 25% tariff on steel has also been removed entirely.
The blanket 10% tariff imposed on imports from the UK by Trump as part of his sweeping “liberation day” announcement remains in place, but talks are ongoing in an effort to ease it.
The agreement provides a tariff-free quota for 13,000 tonnes of US beef imports to Britain, and vice versa, as well as slashing the tariff on US ethanol.
The Trump administration hailed the deal as paving the way for an “exponential” rise in US beef exports, though, Sir Keir stressed that the UK’s “red line” on food standards had been maintained, with imports of hormone-treated beef or chlorinated chicken remaining illegal.
The US president is yet to announce tariffs on pharmaceuticals, a huge UK export to America, but the Prime Minister said Britain would get a “significantly preferential” outcome.
Previous speculation had suggested the UK would revise the digital services tax as part of a deal, with the levy mainly applying to US tech companies.
But Number 10 said on Thursday the tax would remain unchanged, with the two countries agreeing to work on a separate digital trade deal that would reduce paperwork for British firms exporting to the US.
