The United States and the European Union have reached a landmark trade agreement, ending months of tense negotiations and averting a potential escalation in tariffs that threatened to strain transatlantic economic relations.
The breakthrough was sealed following high-level talks between U.S. President Donald Trump and European Commission President Ursula von der Leyen at Trump’s Turnberry golf resort in South Ayrshire, Scotland.
Under the terms of the deal, the U.S. will impose a reduced tariff rate of 15% on EU goods—down from the 30% Trump had earlier threatened to implement. In return, the EU will grant American exporters zero-tariff access to its market on a selection of products.
Both leaders hailed the agreement as a major diplomatic and economic win. “We have reached a deal. It’s a good deal for everybody,” Trump said after Sunday’s private meeting. Von der Leyen echoed his sentiment, calling it a “huge deal” after what she described as “tough negotiations.”
The agreement includes exemptions for critical sectors such as aerospace components, specific chemicals, and selected agricultural products. A separate agreement on semiconductor technology is reportedly in development.
Trump announced that the EU will also increase its investment in the U.S. by $600 billion—particularly in defense industries—and commit an additional $750 billion to American energy imports. The move, according to von der Leyen, will help the EU reduce its dependence on Russian energy supplies through increased imports of U.S. liquified natural gas, oil, and nuclear fuel over the next three years.
However, tariffs on global imports of steel and aluminum will remain unchanged at 50%.
French Minister for European Affairs, Benjamin Haddad, welcomed elements of the deal that protect certain French industries but criticized the agreement as “unbalanced.” “It brings temporary stability, but it’s far from fair,” he posted on X.
Ireland’s Prime Minister Micheál Martin said the agreement made transatlantic trade “more expensive and more challenging” than before, while Germany’s Chancellor Friedrich Merz emphasized the importance of “stable and predictable” trade relations. Italy’s Prime Minister Giorgia Meloni expressed cautious support but indicated she would review the deal’s fine print.
The EU’s internal reaction has been measured, with leaders acknowledging the deal’s immediate benefits while questioning its long-term balance.
Trump, who continues to use tariffs as a cornerstone of his economic policy, touted the agreement as a victory for American workers and businesses. It follows similar deals his administration has struck with the UK, Japan, Indonesia, the Philippines, and Vietnam—though his initial goal of “90 deals in 90 days” remains unmet.
“This is a big one,” Trump said, adding that the deal would bring the U.S. and EU “closer together.”
Analysts estimate the U.S. could generate up to $90 billion in new tariff revenue based on last year’s trade volumes with the EU, which totaled nearly $976 billion. In 2024, the U.S. imported $606 billion in goods from the EU and exported $370 billion, a deficit Trump has repeatedly criticized as evidence of unfair trade practices.
Without the agreement, Trump’s threatened tariffs would have affected a wide range of European exports, including pharmaceuticals from Spain, electronics from Germany, French dairy products, and Italian leather goods. The EU had prepared countermeasures targeting U.S. car parts, Boeing aircraft, and beef.
Despite its uneven terms, the agreement is seen as a relief for businesses on both sides of the Atlantic, many of whom had braced for a costly trade war. While the EU has sidestepped steeper tariffs, the deal still leaves it with higher trade costs compared to other U.S. partners such as the UK, which secured a 10% rate in an earlier agreement.
On Monday, Trump is expected to meet British Prime Minister Keir Starmer at Turnberry. The U.S. President will then travel to Aberdeen on Tuesday, where he and his sons will inaugurate the Trump Organization’s third Scottish golf course.
For now, both Washington and Brussels are portraying the agreement as a step forward. Whether it delivers long-term stability remains to be seen.
