Turnberry, Scotland — The US has struck a framework trade deal with Europe, US President Donald Trump announced on Sunday, averting a spiralling row between two allies who account for almost a third of global trade.
The deal, which includes a 15% tariff on EU goods entering the US and significant EU purchases of US energy and military equipment, will bring welcome clarity for EU companies.
However, the baseline tariff of 15% will be seen by many in Europe as a poor outcome compared with the initial European ambition of a zero-for-zero tariff deal, though it is better than the threatened 30% rate.
The announcement came after European Commission president Ursula von der Leyen travelled to Scotland for talks with US President Donald Trump to push a hard-fought deal over the line.
Trump, who is seeking to reorder the global economy and reduce decades-old US trade deficits, has so far reeled in agreements with Britain, Japan, Indonesia and Vietnam, though his administration has failed to deliver on a promise of “90 deals in 90 days”.
Trump has periodically railed against the EU saying it was “formed to screw the US” on trade.
His main bugbear is the US merchandise trade deficit with the EU, which in 2024 reached $235bn, according to US Census Bureau data. The EU points to the US surplus in services, which it says partially redresses the balance.
Earlier, before the meeting, both leaders described the chances of a deal being reached as 50-50.
“We have three or four sticking points I’d rather not get into. The main sticking point is fairness,” he said insisting the EU had to open up to American products.
Von der Leyen acknowledged there was a need for “rebalancing” EU-US trade. “We have a surplus, the US has a deficit and we have to rebalance it ... we will make it more sustainable,” she said.
US commerce secretary Howard Lutnick, who flew to Scotland on Saturday, told Fox News Sunday that the EU needed to open its markets for more US exports to convince Trump to reduce a threatened 30% tariff rate that is due to kick in on August 1.
Ambassadors of EU governments, on a weekend trip to Greenland organised by the Danish presidency of the EU, held a teleconference with EU Commission officials on Sunday to agree on the amount of leeway Von der Leyen would have.
In case there was no deal and the US imposed 30% tariffs from August 1, the EU had prepared counter-tariffs on €93bn of US goods.
EU diplomats had said a deal was likely to include a broad 15% tariff on EU goods imported into the US, mirroring the US-Japan trade deal, with a 50% tariff on European steel and aluminium for which there could be export quotas.
EU officials are hopeful that the 15% baseline tariff would also apply to cars, replacing the current 27.5% auto tariff.
Possible exemptions
Some expect the 27-nation bloc may be able to secure exemptions from the 15% baseline tariff for its aerospace industry and for spirits, though probably not for wine.
The EU could also pledge to buy more liquefied natural gas from the US, a long-standing offer, and boost investment in the US.
Trump told reporters there was “not a lot” of wiggle room on the 50% tariffs that the US has on steel and aluminium imports, adding, “because if I do it for one, I have to do it for all”.
The US president, in Scotland for a few days of golfing and bilateral meetings, said the deal should draw to a close discussions on tariffs, but also said pharmaceuticals, for which the US is looking into new tariffs, would not be part of a deal.
The EU now faces US tariffs on more than 70% of its exports, with 50% on steel and aluminium, an extra 25% on cars and car parts on top of the existing 2.5% and a 10% levy on most other EU goods.
EU officials have said a “no-deal” tariff rate of 30% would wipe out whole chunks of transatlantic commerce.
Seeking to learn from Japan, which secured a 15% baseline tariff with the US in a deal almost a week ago, EU negotiators spoke to their Japanese counterparts in preparation for Sunday’s meeting.
Reuters
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