EU-US trade deal: European leaders back plan amid criticism – DW – 07/28/2025

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4 days ago

Germany's Friedrich Merz welcomes US-EU trade pact, saying it avoids "needless escalation in transatlantic trade relations." While specifics are yet to be disclosed, the deal marks a pivotal moment following tensions.
The US and EU have announced a trade deal that would set tariffs at 15% for European goods, including automobiles, averting the worst-case scenario.
"This is the biggest deal ever made," Trump said, lauding EU plans to dramatically increase its purchases of US energy and military equipment as part of the deal.
Trump said the tariff rate would apply to "automobiles and everything else" and added that the 50% tariff on steel and aluminum "stays the way it is."
The baseline 15% tariff is still seen by many in Europe as too high, compared with Europe's initial hopes to secure a zero-for-zero tariff deal.The trade agreement framework between the United States and the European Union is worse than the deal the United Kingdom has with Washington, Hungarian Prime Minister Viktor Orban said Monday.
"Donald Trump did not reach an agreement with Ursula von der Leyen, but rather Donald Trump ate Ursula von der Leyen for breakfast," Orban said during a Facebook livestream.
The European Union and the United States reached a trade agreement Sunday that imposes a 15% tariff on most EU goods, higher than the United Kingdom's 10% tariff rate.
Orban, widely regarded as Trump's strongest ally in Europe, has previously said US tariffs were the result of Brussels' incompetence, according to his government.
France's European affairs minister, Benjamin Haddad, criticized what he described as an "unbalanced" trade deal between the EU and the US.
"The trade deal negotiated by the European Commission with the United States will provide temporary stability for economic actors threatened by American tariff escalation," Haddad said.
"But it is unbalanced," he stressed.
"Let's be clear: the current state of affairs is not satisfactory and cannot be sustainable."
France has long called for a tough line on the US tariff policy, as well as for the European Union to develop its strategic autonomy.
The Federation of German Industries (BDI) criticized the trade deal between the EU and the US, calling it an "inadequate compromise" that sends a "disastrous signal."
The powerful industry lobby group said that the EU was accepting painful tariffs and that a 15% tariff rate is expected to have significant negative consequences.
"The only positive aspect of this agreement is that a further escalation spiral has, for now, been avoided," BDI said.
It added that the lack of a deal on steel and aluminum exports was an "additional blow."
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DW Correspondent Birgit Maass said that many in the EU and critics of Donald Trump would say that US President Donald Trump has strong-armed the EU to get concessions, using the leverage of his country's resources when it comes to security policy.
"NATO and the US have been a big guarantor of European security. This obviously comes all in a mix. Europe needs the US not just for trade but also for the general security situation with a war in the continent of Europe, in Ukraine, and the threat that's being posed by Russia." she said.
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Italy's Prime Minister Giorgia Meloni called the trade deal between the EU and the US "positive," but added that she would need to see the details.
Italy is one of Europe's biggest exporters to the US, with a trade surplus of over €40 billion.
"I consider it positive that there is an agreement, but if I don't see the details I am not able to judge it in the best way," Meloni said.
The country's national coalition-led government had pressed its European partners to refrain from a trade clash with the US.
Meloni said in a statement that the deal "ensures stability". She added that the 15% tariff "is sustainable, especially if this percentage is not added to previous duties, as was originally planned."
The statement was also signed by coalition partners, Antonio Tajani of Forza Italia and Matteo Salvini of the League.
"We are ready to activate support measures at the national level, but we ask that they also be activated at the European level for sectors that will be particularly affected by US tariff measures," Meloni added.
Irish Prime Minister Micheal Martin hailed the agreement between the European Union and the United States, saying that it will help "protect many jobs" in his country.
"The negotiations to get us to this point have been long and complex, and I would like to thank both teams for their patient work," he said.
"We will now study the detail of what has been agreed, including its implications for businesses exporting from Ireland to the US, and for different sectors operating here," he added.
Martin also noted that higher tariffs will make trade between the EU and US more expensive and challenging.
But he said the deal creates a "new era of stability" that could promote a deeper relationship between the EU and the US, which the Irish prime minister said was important for the global economy.
"Given the very real risk that existed for escalation and for the imposition of punitively high tariffs, this news will be welcomed by many," Martin said.
The trade pact means the bloc would avoid the 30% tariffs that Trump had threatened on all goods from the EU on July 12.
But it marks a significant compromise, especially given that European Commission President Ursula von der Leyen offered a "zero-for-zero tariffs for industrial goods" when talks began.
Still, von der Leyen said they agreed "zero-for-zero tariffs on a number of strategic products" including aircraft and aircraft parts, some chemicals, and certain agricultural products.
She added that the framework trade deal did not contain any decision regarding the spirits sector.
The trade pact will need to be approved by all 27 member states.
After the US and European Union reached a trade deal, Dutch Prime Minister Dick Schoof thanked the European Commission, which is responsible for EU policy on trade, for a determined effort "to secure the best possible outcome for our businesses and consumers."
But Schoof also wrote that: "Of course, no tariffs would have been better, but this agreement provides more clarity for our businesses and brings more market stability."
German Chancellor Friedrich Merz welcomed the trade agreement between the European Union and the US which will see a 15% tariff on EU goods entering the US.
"We have thus managed to preserve our fundamental interests, even if I would have wished for more relief in transatlantic trade," Merz said in a government statement issued on Sunday evening.
The no-deal scenario would have "hit the export-oriented German economy hard," according to Merz.
He added that this applied in particular to the automotive industry, where the current tariffs of 27.5% have been almost halved.
The US is Germany's main trading partner.
The EU and US have struck a trade deal, with European Commission President Ursula von der Leyen saying the deal "will bring stability." She later told reporters that the tariff level on cars was "the best we could get."
Though specifics are yet to be revealed, she also told reporters that bilateral tariff exemptions had been agreed on for a number of strategic products.
But a decision was still pending on other critical sectors like pharmaceuticals and steel and aluminum.
Follow along for the latest news and reactions to the deal.