EU and US agree trade deal, with 15% tariffs for European exports to America

July 27, 2025

The United States and European Union have reached a trade agreement that establishes a 15% US tariff on EU goods, half of what President Trump had threatened to implement. The deal follows negotiations between Trump and European Commission President Ursula von der Leyen at Trump's Turnberry golf course in Scotland. As part of the agreement, the EU will invest $600 billion in the US and spend $750 billion on American energy over the next three years, while eliminating tariffs on certain US exports including aircraft parts, chemicals, and some agricultural products.

Who is affected

EU exporters to the US across various sectors, including Spanish pharmaceuticals, Italian leather, German electronics, and French cheese
US exporters of aircraft, plane parts, certain chemicals, and some agricultural products
Consumers in both the US and EU who purchase imported goods
European alcohol producers, particularly in France and Netherlands, who are still seeking tariff exemptions
Steel and aluminum exporters who will still face a 50% US tariff
Ireland, which is the most reliant EU country on the US as an export market
Businesses and economies in all 27 EU member states

What action is being taken

The US is implementing a 15% tariff on EU goods instead of the threatened 30%
The EU is eliminating tariffs on certain US exports
The EU is committing to invest $600 billion in the US
The EU is pledging to spend $750 billion on American liquified natural gas, oil, and nuclear fuels over the next three years
EU ambassadors are meeting for a debrief from the European Commission
Technical details of the "framework" agreement are being negotiated "over the next weeks"

Why it matters

The deal ends a months-long standoff between two of the world's largest economic partners who together account for almost a third of global trade
It prevents a potential trade war that could have seen retaliatory EU tariffs on US goods including car parts, Boeing planes, and beef
The agreement will bring stability to economic actors threatened by tariff escalation
The EU's energy investment will help reduce European reliance on Russian power sources
The deal represents significant tariff revenue (approximately $90 billion based on last year's trade figures) for the US government
It marks another trade agreement in Trump's efforts to reorder the global economy and trim the American trade deficit

What's next

EU member states' ambassadors will meet on Monday for a debrief from the European Commission
The technical details of the "framework" agreement will be negotiated "over the next weeks"
A separate deal on semiconductors may be announced soon
The European Commission must secure approval from all EU member states for the trade deal

Read full article from source: BBC