Key Points
- The U.S. and EU have signed a new framework trade deal. The deal imposes a 15% import tariff on most goods coming from the EU.
- The agreement averts a threatened 30% tariff that was set to begin on August 1.
- The EU also committed to investing $600 billion in the U.S. and buying $750 billion in U.S. energy.
- Reaction in Europe is mixed; some are relieved to avoid a trade war, while others are critical of the new tariffs.
The United States and the European Union have struck a major new trade deal, imposing a 15% import tariff on most EU goods. The agreement averts a much harsher trade battle between the two economic giants, who together account for nearly a third of global trade.
The announcement followed a meeting between European Commission President Ursula von der Leyen and U.S. President Donald Trump at his golf course in Scotland, where they finalized the agreement.
President Trump called the agreement the “biggest deal ever made.” At the same time, von der Leyen said it will bring “stability and predictability.” Beyond the tariffs, the deal includes a massive commitment from the EU to invest $600 billion in the United States and purchase $750 billion worth of U.S. energy over Trump’s second term.
While the 15% tariff is a better outcome than the threatened 30% rate, many in Europe had hoped for a zero-tariff deal. Reaction in Europe was mixed, with German industry leaders expressing relief while some EU lawmakers were more critical. The 15% tariff will apply to most goods, including autos; however, steel and aluminum will continue to be subject to a higher 50% tariff.
The deal came just ahead of an August 1 deadline, when Trump had threatened to impose a crippling 30% tariff on the EU if no agreement was reached. The EU had prepared its counter-tariffs in response. The deal is the latest in President Trump’s effort to reorder the global economy and reduce U.S. trade deficits.
