The deal is dead. At least for now. White House sources confirm they have pulled the plug on renewing the USMCA, the trilateral trade agreement with Canada and Mexico. Reason? A familiar one. Washington wants tougher concessions on digital trade and supply chains. Mexico and Canada balked. So the White House walked.
This is a game-changer for the UK. Starmer’s government had been watching from the wings, hoping a renewed North American bloc would offer a template for a future UK-US trade deal. No longer. The message from Washington is clear: America First. Not just in tariffs. In everything.
So where does that leave Britain? Pivoting. Fast. Trade officials at the Department for Business and Trade have been told to accelerate bilateral negotiations with Canada, Mexico, and even individual US states. The plan is to bypass the federal gridlock. Think California. Think Texas. Think provincial deals with Alberta and Ontario.
But let’s be real. This is risky. Canada is furious at the US. Mexico is threatening retaliatory tariffs. And the UK? It could get caught in the crossfire. One Whitehall insider told me: “We are walking a tightrope. One wrong step and we fall into a trade war with both sides.”
The mood in Downing Street is jittery. Starmer’s team had banked on a stable USMCA as a sign that the US was still open to multilateral deals. Now they are scrambling. The PM’s trade envoy, Lord Frost, is already on a plane to Ottawa. His brief: offer a fast-track FTA with Canada, mirroring the EU deal but tailored to British strengths in services and tech.
Meanwhile, the Labour left is smelling blood. They see this as proof that US alignment is a fool’s errand. Momentum is pushing Starmer to embrace a “Global Britain” that trades more with India and the Indo-Pacific. But the Treasury is wary. It knows that US markets are still the deepest. Losing them would be a body blow.
So what happens next? Watch the polling. If the White House stands firm, expect a cabinet split. The internationalists will push for a charm offensive in Washington. The left will demand a radical reorientation. And Starmer? He will try to hold the middle. For now.
But the clock is ticking. The USMCA expires in July. After that, it’s every nation for itself. And the UK, for all its talk of independence, is suddenly very alone.
