The European Union and the United States announces a deal: the collapse of the Trade Agreement Business and Economics News

The United States and the European Union arrived Large trade agreementHe ended a confrontation for months and avoiding a full commercial war a few days before President Donald Trump’s deadline to impose a very declining tariff.

The European Union will pay 15 percent of the customs tariff on most goods, including cars. The customs tariff rate is half 30 percent of Trump threatening to implement from Friday. Brussels also approved on Sunday to spend hundreds of billions of dollars on US weapons and energy products at the top of the current expenses.

Speaking to correspondents at Turnberry Golf resort in Scotland, Trump praised the agreement as the “largest deal ever”. “I think it will be great for both parties. It will bring us closer,” he added.

European Commission President Ursula von der Lin said that the agreement “will achieve stability” and “bring the possibility of prediction, which is very important to our work on both sides of the Atlantic Ocean.”

Von der Lain defended the deal, saying that the goal is to restore a trade surplus balance with the United States. Trump did not hide the use of customs tariffs to try to trim the trade deficit in the United States.

Sunday agreement agreed Months of tense shuttle diplomacy often Between Brussels and Washington, although either side did not reveal the full details of the coalition or issue any written materials.

It follows the initial trade agreements signed by the United States Japanthe UKand Indonesiaand Vietnam and Philipini And a commercial gift for 90 days with China.

How will the deal affect both sides, which represent nearly a third of world trade, and will the threats of the tariff war be ended?

What was agreed?

At a news event at the Trump’s Golf Resort, Von Der Leyen said that the tariff by 15 percent will be applied to European cars, pharmaceutical preparations and semi -conductors – all important products for the European economy.

For his part, Trump said that the American graphics on steel and aluminum, which he identified by 50 percent in many countries, will not be reduced to European Union products, which led to the presence of industry hopes in the bloc. Elsewhere, a flight tariff will remain in zero at the present time.

In exchange for the 15 percent tariff rate on European Union goods, Trump said that the bloc “will open their country when a zero tariff” of American exports.

In addition, he said that the European Union will spend an additional $ 750 billion on US energy products, and invests $ 600 billion in the United States and buy military equipment worth “hundreds of billions of dollars.”

Von Der Leyen confirmed that the European Union will seek to buy $ 250 billion of US energy products every year until 2027.

“With this deal, we believe in reaching our largest export market,” she said.

Meanwhile, she admitted that the 15 % definitions will be “a challenge for some” European industries.

The European Union is the largest trading partner of the United States with two -way trade and services last year up to about $ 2 trillion.

How did European leaders respond?

German counselor Friedrich Mirz welcomed the agreement, saying that he avoids an “unnecessary escalation in the Atlantic trade.”

He said that the trade war “would have been hitting the economy of Germany directed towards export,” noting that the German auto industry would witness that the customs tariff decreased from 27.5 percent to 15 percent.

But French Prime Minister Francois Bayro described the deal as a “dark day” for Europe, saying that the bloc had entered the American president with an unbalanced deal that exceeds American imports of any immediate European revenge.

“It is a dark day when an alliance of free peoples collects, to confirm their common values and defend their common interests, resigning himself to present,” Bayro wrote on X what he called “Von Der Leyen-Trump Deal.”

Wolfgang Nieedermark, a member of the Board of Directors of the German Federation of Industries in Trade, described the deal as a “insufficient compromise” with the European Union “accepting painful definitions.”

He said that the customs tariff rate of 15 percent “will have a significant negative impact on the German industry directed towards export.”

Earlier, Benjamin Haddad, Minister of European Affairs in France, said: “The commercial agreement … will bring temporary stability to the economic actors threatened by the escalation of American definitions, but it is unbalanced.”

Referring to this feeling, Dutch Foreign Trade Minister Hanik Bouirma said that the deal is not “perfect” and called on the committee to continue negotiations with Washington.

The European Commission is responsible for negotiating the commercial deals of the entire bloc.

European Union ambassadors will discuss the agreement with the committee this week.

How was the trade made before the deal?

On July 12, Trump threatened to impose 30 percent A tariff on the European Union goods if the two sides are not able to reach an agreement before Friday, on the day when the comment on the implementation of what Trump calls “his mutual definitions”, which he placed in almost all countries in the world, ends.

These “mutual definitions” are scheduled to enter into force in addition to 25 percent Definitions on cars and auto parts and 50 percent A tax on steel and aluminum products already Trump.

On the European side, it is understood that Brussels would have been ranging forward with a package of revenge definitions on 90 billion euros (109 billion dollars) of American goods, including auto parts and bourbon, if the talks collapsed.

The European Union was a frequent target to escalate the commercial discourse by Trump, who accused the bloc of “tearing” the United States.

In 2024, the United States ran the goods of $ 235.6 billion with the European Union. Medicines, auto parts and industrial chemicals were among the largest European exports to the United States, according to European Union data.

How will the deal affect the United States and the European Union?

Bloomberg Economics estimated that the results of the lack of effort would raise the effective rate of the United States’ tariffs on European goods to nearly 18 percent on Friday.

The new deal reaches this number to 16 percent, providing a small re -postponement of European export companies. However, the current commercial barriers are much higher than before Trump took office in 2025.

According to BRUEGEL, a research group, the average American tariff rate on European Union exports was only 1.5 percent at the end of 2024.

“I think Trump’s strategy was clear from the beginning … it’s the edge of the abyss … either a partner with the United States or facing a high tariff,” said William Lee, the chief economist at the Milkin Institute.

Meanwhile, US Trade Secretary Howard Lootnick said: “President Trump has just opened one of the world’s largest economies. The European Union opens its 20 trillion dollars and completely accepts our car and industrial standards for the first time ever.”