President Donald Trump has announced a deal with the EU that will avert a spiralling trade war between the blocs.
The deal, which includes a 15% tariff on EU goods entering the US and significant EU purchases of US energy and military equipment, will bring clarity after weeks of negotiations.
The deal also calls for $600 billion in investments in the US by the European Union, he told reporters.
But many in Europe could see the deal as a poor outcome compared to the initial ambition of a zero-for-zero tariff deal, although it is better than the threatened 30% rate.
The announcement came after European Commission President Ursula von der Leyen travelled to Scotland for talks with Trump to push a hard-fought deal over the line for the blocs that make up almost a third of global trade.
Ursula von der Leyen on Sunday said a U.S. baseline tariff rate of 15% on imported EU goods would apply to cars, semiconductors and pharmaceutical goods.
She also said that a zero-for-zero tariff rate had been agreed for certain strategic products, including aircraft and aircraft parts, certain chemicals, and certain generic drugs. No decision had been taken on a rate for wine and spirits, she added.
‘Today’s deal creates certainty in uncertain times, delivers stability and predictability,’ von der Leyen told reporters before leaving Scotland.
German Chancellor Friedrich Merz said: ‘This agreement has succeeded in averting a trade conflict that would have hit the export-orientated German economy hard.
‘This applies in particular to the automotive industry, where the current tariffs of 27.5% will be almost halved to 15%.’
Trump, who is seeking to reorder the global economy and reduce decades-old trade deficits, has so far reeled in agreements with Britain, Japan, Indonesia and Vietnam, although his administration has failed to deliver on a promise of ’90 deals in 90 days.’
Trump has periodically railed against the European Union saying it was ‘formed to screw the United States’ on trade.
It took only a few minutes after stepping off Air Force One for Trump to begin predicting doom for the West due to immigration.
He told reporters: ‘On immigration, you better get your act together. You’re not going to have Europe anymore, you’ve got to get your act together.’
