The UK Government is reviewing its Chagos Islands agreement with Mauritius, with Defence Secretary Wes Streeting confirming that planned annual payments will not be made while the current deal remains on hold.
Streeting said the agreement to transfer sovereignty over the Chagos Archipelago to Mauritius “can’t go ahead without American support”, after US President Donald Trump reiterated his opposition during his first face-to-face meeting with Prime Minister Andy Burnham in New York.
The Defence Secretary also confirmed that payments under the agreement would not be made “at this stage” while ministers work with the United States over its concerns.
Government says current deal needs revising
The UK and Mauritius signed the treaty in May 2025. Under its financial arrangements, Britain agreed to pay Mauritius £165 million annually for the first three years after the treaty enters into force, followed by £120 million a year from year four, with later payments subject to indexation.
The agreement also contains separate provisions for a £40 million Chagossian trust fund and £45 million a year for 25 years for development projects in Mauritius.
Streeting said the current agreement does not have the support of President Trump and the United States and that the Government therefore needs to revisit and revise it to address American concerns.
He stressed that securing long-term certainty for the joint UK-US military base on Diego Garcia remains the central objective.
Trump calls agreement a 'terrible deal'
The latest development follows talks between Burnham and Trump on the sidelines of the United Nations General Assembly.
Trump publicly described the Chagos agreement as a “terrible deal” and emphasised the military and strategic importance of the islands.
An official Downing Street account of the meeting said that, on Diego Garcia, Burnham was committed to “working with all parties to find a solution”.
The Prime Minister had also spoken to Mauritian Prime Minister Navin Ramgoolam on 21 September. Downing Street said Burnham underlined his commitment to working with Mauritius and the United States on a way forward that secures the operation of the Diego Garcia base and protects UK national security.
Payments will not be made 'at this stage'
Streeting confirmed on Wednesday that the annual payments envisaged by the treaty would not proceed at this stage.
The distinction is important: the Government has not announced that the treaty has been scrapped, nor has it formally abandoned the proposed transfer of sovereignty to Mauritius.
Instead, ministers are seeking changes capable of securing US support before the agreement can proceed.
Streeting said a financial agreement could still represent a price worth paying if it provided long-term security for Britain's continued use of Diego Garcia.
Why Diego Garcia matters
Diego Garcia hosts a strategically important joint UK-US military facility in the Indian Ocean and has been used to support military operations across the Middle East and wider region.
The 2025 treaty would see Mauritius gain sovereignty over the Chagos Archipelago while the UK retained rights over Diego Garcia under a 99-year arrangement designed to guarantee the continued operation of the base.
The future of that agreement now depends on further negotiations involving London, Washington and Mauritius.