Trump gets a handshake, Europe gets a shakedown
by Eddy Wax, with Nicoletta Ionta. Feedback is welcome
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In today's edition:
- Transatlantic stability, at a price - NGOs defy Brussels over lobbying clause - Merz pushes Netanyahu for a ceasefire - Orban threatens to block EU budget - UK, Norway and Ukraine invited to join IRIS² - Slovak military training: patriotism or PR?
In the capital
After months of tariff threats, social media taunts and squabbling between member states, Donald Trump got what he came for on Sunday: a deal with Ursula von der Leyen that locks in a 15% tariff on most European goods, down from his threatened 30% but far above the zero-for-zero pact that Brussels had offered Washington. The EU blinked.
It's hard to say what was more uncomfortable during the meeting between the leaders of the world's two largest economies at Trump's Scottish golf course yesterday.
Was it when von der Leyen thanked him for a deal that will see EU exporters, including car makers, slapped with 15% tariffs to access the US market? Was it when she praised him as a 'tough negotiator and dealmaker,' only for Trump to interrupt and insist he was also 'fair' – and she agreed?
Or was it when, sitting side by side, he listed his wins: $750 billion in EU energy purchases, another $600 billion in promised investments, and a 'vast' amount of military hardware on top of that?
Von der Leyen sold the deal as "the best we could get.' But the EU's defence of the agreement says everything you need to know about how Europe approached these negotiations: never fully convinced that Trump's threats were just that – and never seriously countering with ones of its own.
'I think it's great that we made a deal today instead of playing games,' Trump said, after he spent weeks publicly pressuring Brussels with escalating tariff ultimatiums.
Months of warning from Brussels that higher tariffs would ultimately hurt consumers worldwide, including Americans – were nowhere to be heard yesterday. Instead, von der Leyen described the agreement – in near-Trumpian terms – as a 'huge deal,' and EU officials backed her, calling it the 'biggest trade deal ever.'
That's a hard sell. Only a few months ago, the EU was eyeing a 10 percent tariff – lower than the 15. Last night, John Clarke, a former senior European Commission official who dealt with trade and agriculture, blasted the framework as the 'worst trade deal ever.' Even some MEPs from von der Leyen's own centre-right family, have criticised the outcome as mere damage control, warning that it hurts European industry.
Still, national leaders who pushed the Commission not to retaliate – including Germany's Friedrich Merz and Italy's Giorgia Meloni – gave positive reactions to the deal, stressing the importance of maintaining stability. French President Emmanuel Macron, who pushed for a tougher approach to negotiations, remained notably silent Sunday night.
With some details still to be ironed out, von der Leyen pointed to several micro-wins.
Compared to the tariffs that Japan, Canada and Mexico are facing, the EU deal might not end up looking too bad. Von der Leyen said she has secured zero tariffs on aircraft and other goods, a list that could grow. Looming US tariffs on European pharmaceuticals will be capped at 15%, although how high they go elsewhere remains unclear. And while some US agricultural imports could now face zero tariffs – it is not yet known which ones - most of the EU's existing protections appear intact.
There is also more at stake than just trade in goods, which represent only part of the EU-US relationship. Europe depends on America for security and wants to keep Trump onside when it comes to Ukraine.
All in all, many in Brussels may soon regret not pushing back harder when Trump first imposed tariffs earlier this year, especially if the US ups the ante when talks continue over the details.
Von der Leyen and defenders of the deal have underlined that stability is now the order of the day. But as always, that depends on Donald J. Trump.
Euractiv's Thomas Møller-Nielsen has the full breakdown of what's been announced so far.
NGOs defy Brussels over lobbying clause
Most non-governmental organisations ignored the Commission's request to reword their funding agreements following an outcry over EU money being used to lobby MEPs.
According to a 24 July letter, seen by The Capitals, all 28 NGOs that received money under the EU's LIFE funding programme did not update their grant agreements, though they were perfectly within their rights, as the contracts have now expired, Budget Commissioner Piotr Serafin informed the Parliament's anti-fraud chief Niclas Herbst in the letter.
Under pressure from right-wing lawmakers, Serafin acknowledged earlier this year that "it was inappropriate for some services in the Commission" to oblige "NGOs to lobby members of the European Parliament specifically." The Commission has since issued updated guidance.
Of the 30 NGOs receiving funding to 2027 from the Commission's health directorate, only half have requested their contracts be amended in line with the new guidance, the letter notes.
The Commission 'considers that it has exhausted all legal and practical possibilities to ensure alignment,' the letter states. A new investigative team in Parliament, led by the EPP's Dirk Gotink and ECR's Carlo Fidanza, will get to work examining more contracts after the summer.
Merz pushes Netanyahu to secure ceasefire
In a call on Sunday, German Chancellor Friedrich Merz urged Israeli Prime Minister Benjamin Netanyahu to do everything in his power to secure an immediate ceasefire in Gaza and allow more humanitarian aid to reach civilians. Germany will consider taking steps to contribute to that effort, in coordination with France, Britain, the US, and Arab states, a government spokesperson said, without specifying what those measures might entail.
Their conversation comes amid mounting pressure for a resolution to the conflict in the Middle East. Last week, Emmanuel Macron announced that France will move to recognise the state of Palestine, becoming the first member of G7 to do so.
Orban threatens to block EU budget
Hungarian Prime Minister Viktor Orbán on Saturday threatened to block the EU's proposed €2 trillion long-term budget unless Brussels releases suspended funds tied to a long-running rule-of-law dispute.
Speaking at a summer event, Orbán also lashed out at EU support for Ukraine. Meanwhile, opposition challenger Péter Magyar has pledged to restore ties with the EU and NATO if elected. Read more.
The Capitals
BERLIN
The European Commission is unlikely to penalize Germany for breaching the EU's deficit limit, as the overspending is fully tied to defence, EU Economy Commissioner Valdis Dombrovskis told the Financial Times. Under the bloc's new fiscal rules, certain defence spending can be excluded, and a final assessment is expected in spring 2025. Read more.
PARIS
The US on Friday condemned France's criminal investigation into Elon Musk's platform, X, calling it an attack on free speech and accusing French authorities of politically motivated foreign censorship. The probe, focused on suspected algorithm manipulation, was launched by French cybercrime prosecutors after complaints that X may have been used to interfere with domestic politics. Read more.
VIENNA
Austria's Foreign Minister Beate Meinl-Reisinger said she's 'very open' to a national debate on the country's future security and defence strategy — challenging Austria's long-held neutrality.
'Neutrality alone is not enough,' she told German newspaper Die Welt, urging greater defence spending and stronger international alliances. There may not be majority backing in parliament or among the public for NATO membership right now, but she insists: 'Such a debate can still be very fruitful.'
MADRID
Spain's conservative opposition is stepping up efforts ahead of the 2027 election, as Prime Minister Pedro Sánchez faces mounting pressure over a corruption scandal. Popular Party leader Alberto Núñez Feijóo is convening a Monday meeting of his Executive Committee to energise the base.
The Popular Party hopes to capitalise on the fallout from a bombshell June report, which linked members of Sánchez's inner circle to a kickback scheme, deepening political tensions and eroding public trust in the Socialist-led government. Read more.
ATHENS
Wildfires raged across Greece for a second day on Sunday, devastating homes, forests, and farmland, with Kythera and Evia among the hardest-hit areas amid ongoing evacuations and extreme heat. Greece has requested EU assistance, with Czech crews already deployed and Italian firefighting planes en route to support local efforts. Read more.
WARSAW
President Andrzej Duda will meet with Speaker Szymon Hołownia after Holownia claimed he was urged to delay the swearing-in ceremony of President-elect Karol Nawrocki, scheduled for 6 August.
Following the election, multiple reports surfaced of vote-counting errors across polling stations, raising concerns that the outcome may have been affected. Still, the Supreme Court has upheld the result. Hołownia, who has declined to name who pressured him, insists there is no legal basis to delay the ceremony. Read more.
BUCHAREST
Deputy Prime Minister Dragoș Anastasiu resigned on Sunday, just weeks after taking office, following revelations that his companies had paid over €150,000 in bribes to a tax inspector from the very agency he was appointed to oversee.
While admitting to the payments, which he described as 'survival bribes,' Anastasiu said he could no longer be effective in the role amid mounting public pressure. Read more.
Also on Euractiv
Non-EU countries such as Norway, Ukraine and the United Kingdom could follow Iceland in joining the EU's secure communication satellite network IRIS² as an alternative to Elon Musk's Starlink, Defence and Space Commissioner Andrius Kubilius told Euractiv.
Patriotism or PR? Slovakia's new military training draws mixed reactions
Slovakia's new military course wins expert praise, but camo-clad politicians spark ridicule
Agenda
EU Commissioner Henna Virkkunen receives a delegation of U.S. congressional members led by Jim Jordan, chair of the House Judiciary Committee
United Nations High-Level Conference on the Question of Palestine and the Two-State Solution; Commissioner Dubravka Šuica to attend
Contributors: Thomas Møller-Nielsen, Robert Hodgson, Nick Alipour, Catalina Mihai, Aleksandra Krzysztoszek, Inés Fernández-Pontes
Editors: Matthew Karnitschnig, Sofia Mandilara, Christina Zhao
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