US Raises Trade Concerns, Delaying US-UK Tech Deal
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Negotiations surrounding the US-UK Technology Prosperity Deal, initially unveiled during a state visit in September, have stalled due to broader trade disagreements. The agreement pledged cooperation between the two nations in areas including artificial intelligence, quantum computing, and nuclear power, as documented in a non-binding Memorandum of Understanding. The UK government, under Prime Minister Sir Keir Starmer and Technology Secretary Liz Kendall, highlighted the deal’s potential to transform lives and establish the UK as an “AI superpower.” Alongside the announcement, US tech firms—including Microsoft, Nvidia, and Google—committed to £31 billion in planned spending to scale-up AI infrastructure across the UK. US-UK Tech Deal Stalls Negotiations surrounding the US-UK Tech Prosperity Deal have stalled due to wider disagreements in trade negotiations between the two countries. Unveiled in September, the deal initially pledged cooperation in areas like AI, quantum computing, and nuclear power, documented in a non-binding Memorandum of Understanding (MOU). However, progress is now linked to substantive progress on a broader US-UK Economic Prosperity Deal signed in May, indicating the tech agreement isn’t progressing in isolation. When announced, the Tech Prosperity Deal anticipated £31 billion in planned spending from US tech firms like Microsoft, Nvidia, and Google, intended to scale-up AI infrastructure including data centers. Despite the current impasse, these investment plans are reportedly unaffected. Nvidia‘s boss, Jensen Huang, expressed belief in the UK becoming an “AI superpower”, reflecting the initial optimism surrounding the deal and its potential to boost Britain’s AI sector. The stalled tech deal reflects a “piecemeal approach” to trade agreements, according to Allie Renison, a former government trade advisor. Rather than comprehensive agreements, different areas are being linked, meaning concerns in other sectors—like tariffs on UK steel—are impacting tech agreements. Despite the current challenges, Renison suggests the situation is likely “a bit of posturing” within the broader negotiations. Details of the Tech Prosperity Deal The Tech Prosperity Deal, unveiled during a US Presidential visit in September, initially pledged cooperation between the UK and US in areas like AI, quantum computing, and nuclear power. A Memorandum of Understanding (MOU) documented this partnership, outlining potential collaboration to build “powerful quantum machines” and scale AI infrastructure. However, the MOU stated that any proposals were non-binding and contingent upon progress with a broader US-UK Economic Prosperity Deal signed in May. Planned investment totaling £31 billion was announced by tech giants including Microsoft, Nvidia, and Google alongside the Tech Prosperity Deal, intended to scale-up AI infrastructure like data centers across the UK. Despite the stalled negotiations, these investment plans are currently believed to be unaffected. Nvidia’s boss, Jensen Huang, expressed belief that the UK could become an “AI superpower,” aligning with the UK government’s ambitions. Negotiations over the Tech Prosperity Deal have stalled due to wider disagreements in trade negotiations between the US and UK. The US has raised concerns about UK trade barriers, impacting progress on the tech deal which is linked to the broader Economic Prosperity Deal. Experts note a “piecemeal approach” to inking trade deals, with different areas linked to separate parts of negotiations, potentially causing these current roadblocks.
Broader Trade Disagreements Impact Tech Negotiations for a “historic” Tech Prosperity Deal between the UK and US have stalled due to wider trade disagreements. While the deal, unveiled in September, initially saw pledges of cooperation in areas like AI, progress is now hindered by US concerns regarding UK trade barriers. A total of £31 billion in planned spending by tech giants – including Microsoft, Nvidia, and Google – was announced alongside the deal, but the impact of these stalled negotiations on those investments remains unclear.
The Technology Prosperity Deal outlined collaboration across AI, quantum computing, and nuclear power, with ambitions to build “powerful quantum machines” and scale-up AI infrastructure. However, the Memorandum of Understanding (MOU) establishing the deal is non-binding and dependent on “substantive progress” towards a broader US-UK Economic Prosperity Deal signed in May. This linkage means progress in tech is tied to resolving disputes in other sectors, such as cars, pharmaceuticals, and steel exports. According to trade advisor Allie Renison, the current impasse reflects a “piecemeal approach” to trade deals between the US and UK. Instead of a comprehensive agreement, different sectors are being negotiated separately, linking progress in one area to another. While investment plans may not be significantly affected, Renison suggests the situation is likely “a bit of posturing” within the wider negotiations, indicating a strategic element to the stalled tech deal. Investment and Future of UK AI The UK and US pledged cooperation in areas like AI through the “Technology Prosperity Deal” announced in September. This deal aimed to be a “generational step change” and was intended to benefit both countries, with the UK government highlighting potential for transforming lives and boosting its “booming AI sector”. Following the announcement, tech giants—including Microsoft, Nvidia, and Google—outlined plans for £31 billion in investment, focused on scaling up AI infrastructure such as data centres across the UK. Negotiations surrounding the Tech Prosperity Deal have stalled due to wider disagreements in trade negotiations between the US and UK. While the pledged £31 billion investment from tech firms isn’t currently believed to be affected, the agreement itself is contingent on progress within the broader US-UK Economic Prosperity Deal signed in May. The Memorandum of Understanding documenting the tech pact explicitly states that proposals aren’t binding without this wider progress. Concerns over areas like digital regulations and food safety rules are contributing to the impasse, reflecting a “slightly piecemeal approach” to trade agreements. Former government trade advisor Allie Renison suggests that concerns in separate trade areas are now impacting the tech agreement. Nvidia’s boss, Jensen Huang, stated his company’s UK investment reflected a belief the UK could become an “AI superpower”, a goal championed by the UK government.
This Tech Prosperity Deal marks a generational step change in our relationship with the US, shaping the futures of millions of people on both sides of the Atlantic.
Sir Keir Starmer Source: https://www.bbc.co.uk/news/articles/c79x54dprngo Tags: