The United States and the European Union have reached a landmark trade agreement that sets a 15 percent tariff on EU exports, a move designed to avoid a full-blown transatlantic trade war. The deal was struck just days before a looming August 1 deadline, which could have seen tariffs spike to 30 percent across the board on European goods.
US President Donald Trump and European Commission President Ursula von der Leyen met at Trump’s golf resort in Turnberry, Scotland, where the agreement was finalized in under an hour. Trump hailed the agreement as the “biggest-ever” trade deal, citing it as a win for both sides. “We’ve reached a deal. It’s a good deal for everybody,” Trump said. “This is probably the biggest deal ever reached in any capacity.”
Under the deal, the 15 percent tariff will apply broadly across key sectors, including automobiles, pharmaceuticals, and semiconductors—industries vital to both economies. In return, the European Union agreed to purchase $750 billion worth of US energy over the next three years and make an additional $600 billion in investments, especially in American military equipment and infrastructure.
Von der Leyen described the agreement as “significant,” noting that it will offer greater predictability and stability for businesses on both sides of the Atlantic. She said the EU would diversify its energy supplies by buying US liquefied natural gas, oil, and nuclear fuels, reducing its dependency on Russian sources. The agreement also includes mutual exemptions for a range of strategic products such as aircraft, agricultural goods, critical raw materials, and specific chemicals.
The 27-member EU bloc had been advocating for further tariff relief, especially in critical sectors like alcohol, which are still under negotiation. Von der Leyen said she remains hopeful that additional zero-for-zero deals can be reached soon.
Trump emphasized the defense angle of the pact, stating that European NATO members would be acquiring “hundreds of billions of dollars’ worth of US military equipment.” The EU has already been subjected to a series of US tariffs since Trump’s return to the White House, including 25 percent on cars and 50 percent on steel and aluminum.
Von der Leyen acknowledged the 15 percent tariff is higher than previous rates but described it as the most favorable outcome possible under current tensions. “Fifteen percent is not to be underestimated, but it is the best we could get,” she admitted.
The agreement must still be ratified by EU member states, who were briefed while on a visit to Greenland. A follow-up meeting will be held to finalize member support. German industrial groups expressed concern, with the BDI calling the deal potentially damaging, and the VCI chemical trade association saying tariffs remained too high. Ireland welcomed the certainty but expressed disappointment over the baseline tariff.
While Trump ruled out adjustments to steel tariffs, von der Leyen claimed a quota system will eventually be implemented, easing pressure on EU exporters. The EU had prepared retaliatory measures on $109 billion worth of US imports if no agreement had been reached, including tariffs on aircraft and automotive products.
Trump described this agreement as “the big one,” suggesting no other trade deal could match its scope or importance. As Washington continues to press other nations for similar pacts ahead of the August 1 deadline, this EU-US deal may set the tone for global trade relations going forward.
