EU and US reach tariff agreement that avoids trade war

The new tariff agreement between the European Union (EU) and the United States (US) , reached on July 27, 2025, in Scotland, has been greeted with relief by several European governments. The pact establishes a fixed 15% tariff on European products entering the US market, thus avoiding a potential trade war that would have begun on August 1.

The meeting between US President Donald Trump and European Commission President Ursula von der Leyen at the Turnberry golf resort resulted in a pact that, while imposing significant tariffs, is seen as a crucial step in preserving transatlantic economic stability .

German Chancellor Friedrich Merz was one of the first leaders to speak out after the announcement. He declared that the agreement avoids a "futile escalation in transatlantic trade relations" that would have had serious consequences for the German economy , particularly for key sectors like the automotive industry .

Merz emphasized that automotive tariffs , currently at 27.5%, will be reduced to 15%, which represents an improvement for European vehicle manufacturers exporting to the United States. Still, he noted that he would have preferred "more easing" in trade between the two economic powers.

From other parts of Europe, reactions to the agreement were positive, if cautious. Italian Foreign Minister Antonio Tajani hailed the pact as a way to end uncertainty. However, he stressed that " we will examine all the details ."

For his part, Belgian Prime Minister Bart De Weber spoke of "relief," but not celebration. He expressed on social media that although a direct confrontation is being avoided, doubts remain about the long-term impact of the new tariff scheme. He warned that tariffs will increase in sensitive sectors, and that some key issues remain to be resolved.

On the US side, the agreement was hailed as a resounding success. US Secretary of Commerce Howard Lutnick described it as a “ historic day for American trade ,” noting that the EU will fully open its $20 trillion market to US industrial and automotive standards .

In addition to the tariff benefits, Lutnick emphasized that the European Union has committed to purchasing some $750 billion in energy and investing $600 billion in the United States, which will strengthen the bilateral economic alliance for " decades ."

Key sectors that will be affected by the new 15% tariff include automobiles, semiconductors, and pharmaceuticals , which until now have enjoyed special benefits or lower tariffs. Despite the tax increase, guaranteed access to the European market is seen as a strategic concession .

The meeting between Trump and von der Leyen took place in an informal but highly symbolic setting: the Turnberry Golf Club, owned by the US president. There, Trump is also scheduled to meet with British Prime Minister Keir Starmer to discuss geopolitical issues such as a ceasefire in Gaza , the conflict in Ukraine , and the implementation of the Economic Prosperity Partnership between the United Kingdom and the United States.

That prior agreement with the United Kingdom allows for mutual tariff reductions , primarily on U.S. agricultural products, in exchange for greater access to British goods in the U.S. market.

The tariff agreement between the EU and the US represents a necessary respite in a global context marked by economic and political tensions. While it imposes a new 15% tariff regime, it avoids an escalation that could have had devastating effects on both economies.

Europe celebrates avoiding a trade war, although it acknowledges that the pact is not ideal. Washington, on the other hand, considers it a strategic and economic victory. As the details of the agreement are revealed, analysts will assess its true impact, especially on key industrial sectors and the long-term transatlantic relationship .