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Diplomacy

US and United Kingdom sign limited trade deal

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The US and the United Kingdom have signed a significant trade agreement after years of negotiations.

Under the agreement, the 10% “reciprocal” tariff rate applied to British goods remains unchanged, while the United Kingdom will benefit from exemptions on steel and automobiles and increased market access for agricultural exports.

The agreement also leaves the door open for further negotiations in the future. US President Donald Trump told reporters in the Oval Office, “The final details will be written in the coming weeks.”

Speaking by phone at the White House press conference, UK Prime Minister Keir Starmer described the agreement as “historic,” stating, “This will increase trade between our countries. It will not only protect jobs but also create employment and open up market access.”

Although the agreement is far from a comprehensive free trade agreement, the United Kingdom became the first country to sign such a deal with Trump.

British automotive sector breathes a sigh of relief

The most significant change is the exemption from the general 25% additional tariff applied to steel, aluminum, and automobiles. Under the agreement, tariffs on British car exports will be reduced to 10%, with an annual quota of 100,000 units.

British prime ministerial sources say this figure is almost equal to the total amount the United Kingdom exported last year. If this quota is exceeded, vehicles will be subject to the 25% tariff.

On the other hand, this rate is four times the 2.5% tariff the UK benefited from before Trump’s second presidential term.

Nevertheless, the reduction in tariffs will provide much-needed relief to British car manufacturers, who exported £9 billion last year and are the United Kingdom’s largest goods exporter to the US.

Reciprocal steps in the steel and aerospace sectors

The agreement completely removes tariffs for the UK’s struggling steel industry, which is facing a crisis under the threat of blast furnace closures and job losses.

The US is currently the United Kingdom’s second most important steel export market after the EU: the American market accounts for 9% of the country’s steel exports by value and 7% by volume.

The US also promises exemptions for UK aerospace parts, while in return, the United Kingdom gains “preferential access” to aerospace components.

Speaking in the Oval Office, US Commerce Secretary Howard Lutnick said, “We have agreed to allow Rolls Royce engines and aircraft parts of that nature to be imported tariff-free.”

Initially, aerospace parts, including those previously exempted for security reasons, were included in the general 10% reciprocal tariff.

London did not compromise on digital tax

It came as a surprise to many that the United Kingdom did not compromise on the digital services tax despite US pressure to reduce the tax. The 2% tax targets the revenues of tech giants like Amazon, Meta, and Google and is estimated to generate £800 million this year. This tax had long drawn criticism from the US on the grounds that it discriminated against American companies.

But as POLITICO first reported on Thursday, the tax did not change as part of the agreement.

Instead, both countries decided to work on a digital trade agreement to eliminate bureaucracy for exporters and simplify customs procedures.

Christine Bliss, President of the Coalition of Services Industries, said in a statement, “The UK’s digital services tax needs to be discussed and addressed in more detail to ensure it is applied fairly to American service providers.”

The technology agreement also envisages greater cooperation in areas such as biotechnology, life sciences, quantum computing, nuclear fusion, and aerospace.

There was also no compromise on the United Kingdom’s online safety rules, which was a great relief for campaigners.

The London government had announced last month, under pressure from Washington, that online safety rules would be reviewed in trade talks with the US, drawing significant backlash.

The United Kingdom’s US Ambassador Peter Mandelson told POLITICO he was “very pleased with the outcome,” adding that his country had “achieved all its main demands and that the agreement will now open the door to a deeper and longer-term US-UK technology partnership.”

Reciprocal market openness and food standards in agriculture

In a move met with skepticism by the agricultural lobby in Great Britain, the countries signed a new reciprocal market access agreement on beef. Under the agreement, British farmers were granted a tariff-free quota of 13,000 metric tons and a reduced tariff rate of between 4% and 10%.

On the other hand, US farmers will also be able to export the same amount of beef to the UK tariff-free.

But more importantly, all imported meat must comply with United Kingdom food standards. This means British farmers can breathe a sigh of relief that hormone-treated beef will not be arriving at their doors anytime soon.

Food standards had been a contentious issue since the United Kingdom-US free trade agreement negotiations began under the first Trump administration in May 2020.

A boon for ethanol exports to the US

In a surprise move, the US was also granted a new tariff-free ethanol quota for the first 1.4 billion liters. Previously, US ethanol exported to the United Kingdom was subject to a tariff of between 10% and 50%, depending on its use.

Speaking at the White House press conference, Trump said the agreement would “significantly” increase market access for American beef, ethanol, and almost all products produced by large farmers.

According to White House documents, the agreement will create “$5 billion in new export opportunities for US farmers, ranchers, and producers.” More than $700 million of this figure will come from ethanol exports, and $250 million from other agricultural products such as beef.

Tom Bradshaw, President of the National Farmers Union, said, “Our biggest concern is that the heavy burden of tariff removal in other sectors of the economy is being placed on the shoulders of two agricultural sectors,” adding that British agriculture “cannot continue to bear such imbalances in future negotiations.”

Bradshaw also added that the inclusion of bioethanol in the agreement “raises concerns for British arable farmers,” and said they were examining what this means for the sustainability of domestic bioethanol production and its potential impact on their members.

The White House also announced that the countries have decided to work together to improve industrial and agricultural market access.

Preferential treatment for pharmaceuticals

The agreement will also allow Britain to negotiate a preferential outcome on pharmaceutical tariffs, even though the US has not yet imposed tariffs on pharmaceuticals.

Pharmaceuticals are the United Kingdom’s second largest export item to the US. The UK exported £6.6 billion worth of pharmaceuticals last year, and this figure accounted for 11.1% of the country’s total exports to the US.

On April 1, Trump launched an investigation into the impact of pharmaceutical imports on national security and announced on Tuesday that he would impose tariffs on this sector “in the next two weeks.”

On the other hand, it is not yet clear whether the United Kingdom will receive preferential treatment regarding the tariffs Trump will impose on the film industry.

Over the weekend, the US President threatened to impose a 100% tariff on foreign films, saying that incentives offered by other countries to attract filmmakers to their countries posed a threat to US national security.

Caroline Dinenage, Chair of the Culture Committee, argued that tariffs on films were “contrary to the interests of American companies” due to “investments in UK facilities and talent based on intellectual property rights held by the US.”

Trade Secretary Jonathan Reynolds said, “At this stage, it is not clear exactly what kind of tariffs the US is proposing to apply in relation to films.”

Diplomacy

South Korea pulls part of embassy staff from Ukraine amid POW dispute

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The South Korean government has decided to withdraw part of its embassy staff from Ukraine.

According to the Yonhap news agency, Foreign Ministry spokesman Park Doo-sun cited the Kyiv administration’s failure to take “positive steps” in the dispute that began with the leak of information concerning the handover of North Korean prisoners of war as the justification for the move.

The spokesman also listed the ongoing threat of air strikes, which complicates the safety of diplomats, among the reasons.

Following the withdrawal of part of the personnel, essential diplomatic contacts will continue under the leadership of the charge d’affaires ad interim to Ukraine. All consular staff tasked with protecting South Korean citizens will remain in Ukraine.

Prior to this move, the Seoul administration decided on 8 October to withdraw its ambassador. The Foreign Ministry stated at the time that it was ready to continue consultations with Kyiv to resolve the emerging issues constructively.

Tensions between the two countries began with a speech delivered by Ukrainian President Volodymyr Zelenskyy at the United Nations General Assembly in September.

Zelenskyy announced that two captured soldiers from the North Korean army had been handed over to South Korea.

South Korean President Lee Jae-myung, meanwhile, accused Kyiv of breaching a confidentiality agreement.

Lee said the disclosure of this information endangered the prisoners’ families and stability on the Korean Peninsula.

Seoul expects a public apology

Dmytro Lytvyn, an adviser to the Ukrainian president, denied the existence of a confidentiality agreement.

The South Korean Foreign Ministry summoned Ukrainian Charge d’Affaires Andriy Veshkin on 28 September and issued a note of protest against Lytvyn’s remarks.

President Lee Jae-myung warned in a statement on 2 October that they would take additional measures against Kyiv if Ukrainian authorities did not acknowledge the agreement and make a public apology. Lee stated that Ukraine itself had initially requested that the transfer of the prisoners be kept confidential.

Ukrainian Foreign Ministry spokesman Heorhii Tykhyi said the dispute stemmed from differing interpretations of the confidentiality regime.

Tykhyi noted that Seoul, based on its constitution which recognises the entire Korean Peninsula as its own territory, requested that the prisoners be handed over “like its own citizens”.

Describing the handover as a “gesture of goodwill”, Tykhyi stated that they were conducting closed-door negotiations to resolve differences of opinion.

Ambassador Park Ki-chang returned to Seoul on 10 October. According to a report by The Korea Times newspaper citing the ministry, recalling the ambassador served as a diplomatic protest against the leak of information regarding the prisoners.

The newspaper wrote that South Korea had last taken a similar step in 2008 by withdrawing its ambassador to Japan.

Moscow warned foreign diplomats

On 3 October, the Russian Foreign Ministry reiterated its warning to foreign nationals, including diplomatic mission staff, against remaining in Ukraine.

The ministry recalled its advice to leave Kyiv, citing ongoing strikes against military targets.

The ministry noted that those who failed to heed the warnings would bear responsibility for the potential consequences.

Kremlin spokesman Dmitry Peskov said in a statement on 24 September that they had no information regarding Kyiv handing over two North Korean prisoners of war to Seoul.

Peskov, noting that prisoner matters fall under the authority of the Defence Ministry and intelligence services, said, “Contacts through the special services are continuing.”

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Ex-BND head Hanning tied to former Mossad chief amid spy inquiry

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August Hanning, who led Germany’s Federal Intelligence Service (BND) between 1998 and 2005, was arrested on 6 October on allegations that he obtained roughly 2,000 classified agency documents and used them during contacts with intelligence officers from a foreign state.

Accused of high treason and espionage on behalf of a foreign intelligence agency, the former spy chief is alleged to have procured the documents from former BND employee Manfred D.

Prosecutors stated that the leaked records included internal briefing notes presented to senior German officials, though the Berlin government has not yet publicly disclosed which country received the classified data.

According to an exclusive report by Jake Green for The Cradle, seized email exchanges revealed extensive ties between the arrested Hanning and former Mossad director Danny Yatom.

The correspondence shows that the two former intelligence directors built an ongoing network of contacts following their public service, combining commercial ventures, efforts to secure political influence, and intelligence links.

This dynamic has triggered debate that using personal connections and official access for private gain has left Germany’s intelligence apparatus vulnerable.

Intelligence notes for 10,000 euros and campaign proposals

According to the reviewed emails, Hanning told Yatom in a 2018 message that he could prepare an “overall assessment based on information obtained from senior German officials and intelligence agencies” concerning an unidentified candidate.

The former BND head committed to completing the report by 13 July in exchange for 10,000 euros.

Contacts between the two men subsequently expanded to cover domestic political processes in Germany. Ahead of the September 2021 federal election, Yatom asked Hanning to approach leading candidates.

Describing CIY Global as a “political campaign company”, the former Mossad chief noted that he aimed to introduce its capabilities to German politicians, and he mentioned his intention in the same exchange to transfer documents concerning a cybersecurity firm.

Cybersecurity partnership and surveillance operations across Europe

The partnership between Yatom and Hanning reached beyond political lobbying initiatives into the cybersecurity sector.

Hanning reportedly served as a consultant for World Health Energy Holdings, a cybersecurity company linked to Yatom.

Firms of this type, established or managed by former intelligence personnel, provide commercial platforms on the international market for Israeli-origin surveillance, cyber intelligence, and political influence capabilities.

The operational presence of private Israeli-based surveillance technologies across Europe has recently entered judicial records through scandals in Poland, Spain, and Greece.

Polish prosecutors announced on 12 October that data collected under the previous government via Pegasus spyware against political opponents had been transferred out of the country, adding that manufacturer NSO Group maintained access to the technical infrastructure.

In Spain, the 2022 CatalanGate investigation established that at least 65 people, including politicians, lawyers, and civil society representatives, were targeted using Pegasus or Candiru software, with Citizen Lab researchers publishing strong evidence linking the operation to Spanish authorities.

In Greece, the surveillance operation targeting journalist Thanasis Koukakis and Member of the European Parliament Nikos Androulakis was determined to have used Predator software, linked to Intellexa, a company founded by former Israeli intelligence officer Tal Dilian.

In the German espionage investigation, the traffic between Hanning and Yatom involving paid reporting, contacts with electoral candidates, and commercial partnerships does not yet provide conclusive legal evidence regarding the final destination of the roughly 2,000 classified documents.

Nevertheless, the disclosed correspondence gives German investigators a concrete line of inquiry to assess whether classified state secrets reached commercial networks tied to Israeli intelligence.

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Trump dismisses US envoy to Greece Kimberly Guilfoyle

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US President Donald Trump has dismissed Kimberly Guilfoyle, the US ambassador in Athens, following serious press reports concerning her conduct.

White House Press Secretary Katie Zacharia told reporters during her first briefing that Guilfoyle had been asked to resign.

“She was doing a good job, but we didn’t like what we read in the press,” Trump said. “She was not a member of my family. I think she dated my son a long time ago.”

In a social media post, Guilfoyle stated: “These claims are unfounded, and I will resolutely defend my name, reputation, and integrity.” She added that she was particularly proud of the embassy’s work.

According to Kathimerini, her removal came as no surprise in Washington. Days of successive disclosures and vigorous exploitation of the matter by Democrats had been inflicting political damage on the White House ahead of the sensitive midterm elections.

The US State Department was instructed not to comment, with crisis management transferred entirely to the White House.

Reports indicate that most of the president’s team swiftly favoured Guilfoyle’s dismissal, while Secretary of State Marco Rubio was reportedly uneasy with the demonstratively warm public welcome she had staged for him.

Democrats on the House Foreign Affairs Committee have called for an investigation.

“Her resignation does not absolve her of responsibility,” the lawmakers wrote, adding: “While American families struggled to make ends meet, she used her position as a Trump administration official to enrich herself.”

Chargé d’Affaires Josh Huck will assume ambassadorial duties until a successor is chosen.

Meanwhile, Guilfoyle’s departure is expected to cause delays in agreements between Greece and the US.

These include the so-called “Rubio package”, comprising approximately $4 billion in arms deals finalised only days before the secretary of state’s arrival.

Several procedural steps still remain before the contracts can be signed.

In Athens, opposition parties are demanding answers. Dimitris Mantzos of PASOK called for a detailed briefing on the agreements reached during Rubio’s visit.

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