The European Union has reached a tentative trade agreement wiht the United States, averting a potential trade war. The bloc had also considered utilizing its “Anti-Coercion instrument,” a measure described as the EU’s “trade bazooka,” during the negotiations.
European leaders largely welcomed the agreement, expressing relief at avoiding a trade conflict. However, some leaders also voiced reservations regarding the specific terms of the deal.
irish Prime Minister Micheál Martin stated that the agreement “brings clarity and predictability to the trading relationship between the EU and the US.” However, a statement from Ireland’s department of the Taoiseach acknowledged that “there will now be higher tariffs than there have been and this will have an impact on trade between the EU and the US, making it more expensive and more challenging.” Despite this, the statement concluded that the agreement “creates a new era of stability.”
German Chancellor Friedrich merz praised the accord, highlighting its positive implications for germany’s automotive sector. He noted that a trade conflict, which woudl have substantially impacted the export-reliant German economy, has been avoided. Merz specifically pointed out that tariffs for the auto industry would be reduced from 27.5% to 15%, a reduction he deemed “of great significance.”
Netherlands Prime Minister Dick Schoof, in a post on X, commented that “no tariffs would have been better,” but commended the European Commission for securing the most favorable agreement possible. He added that the deal “provides more clarity for our businesses and brings more market stability.”
Italy’s Prime Minister Giorgia Meloni and othre government leaders issued a statement indicating that the deal helps prevent a “direct clash between the two sides of the Atlantic” and “guarantees stability” between the U.S. and the European Union.The statement also conveyed Italy’s view that tariffs at 15% would be “lasting,” provided this percentage includes, rather than is in addition to, existing tariffs.
According to the European Council, the U.S.-EU trade relationship, encompassing both services and goods, was valued at 1.68 trillion euros ($1.97 trillion) in 2024. The EU recorded a surplus in goods trading but a deficit in services, resulting in an overall trade surplus of approximately 50 billion euros with the U.S. last year.
