In a world that is changing quickly, the agreement will help the U.S. and the U.K. “remain at the cutting edge,” according to Biden.

The Atlantic Declaration, a limited economic alliance centred on the energy transition and cutting-edge technologies deemed essential to national security, was unveiled on Thursday by U.S. President Joe Biden and British Prime Minister Rishi Sunak.

In a world that is changing quickly, the agreement will help the U.S. and the U.K. “remain at the cutting edge,” according to Biden.

The British Conservative Party pledged in 2019 to negotiate a more comprehensive US-UK free trade agreement within three years of taking office, but the two avoided questions about its progress.

The announcement on Thursday came after discussions at the White House about economic ties and support for Ukraine in its defence against the Russian invasion. It covered technologies like semiconductors and artificial intelligence.

Assuring U.S.-U.K. leadership in crucial and emerging technologies, economic security, digital transformation, and clean energy transition are among the tenets of the Atlantic Declaration.

The White House claims that the agreement will strengthen business and investment ties, diversify supply chains, and lessen strategic reliance on rival nations.

In the U.K., a comprehensive free-trade agreement was once stated as a goal for after Brexit. The British side, however, is showing “real pragmatism,” according to Leslie Vinjamuri, director of the U.S. and the Americas programme at Chatham House, a London-based think tank, because the U.S. Congress has little appetite for new free-trade agreements.

She told VOA that Britain is aiming for specific victories that can advance cutting-edge technology issues, particularly AI, without needing to go through Capitol Hill.

As both capitals work to create regulations that address major risks without stifling innovation, AI, which Biden said presents a staggering potential for technological changes, is a key area of concern.

Senior fellow on global economy and development at the Brookings Institution Joshua Meltzer said, “They’re looking at each other’s models to see how they can do that better.”

Biden and Sunak are aware that China, a rival and leading AI player, has an advantage over them in that it can disregard privacy concerns related to the use of AI for surveillance and facial recognition, and it “really wants to put its foot on the innovation accelerator,” according to Meltzer.

The U.S. and the UK will continue to lead AI, he said, and regulations that strike a balance between values and innovation will determine “where China is going to end up as well.”

As part of the agreement, the two nations will start discussions on critical minerals produced in the UK that are used in electric vehicles and batteries and are eligible for tax credits in the United States. Following a deal signed with Japan that permits some essential raw materials for electric vehicles to be treated as if they were sourced in the U.S., comparable negotiations are currently being held with the European Union.