US and EU strike deal with 15% tariff to avert trade war
Jul 28, 2025
New York [US], July 28: The U.S. struck a framework trade agreement with the European Union on Sunday, imposing a 15% import tariff on most EU goods - half the threatened rate - and averting a bigger trade war between the two allies that account for almost a third of global trade.
U.S. President Donald Trump and European Commission President Ursula von der Leyen announced the deal at Trump's luxury golf course in western Scotland after an hour-long meeting that pushed the hard-fought deal over the line.
Trump said the deal, which tops a $550 billion deal signed with Japan last week, would expand ties between the trans-Atlantic powers after years of what he called unfair treatment of U.S. exporters.
Von der Leyen, describing Trump as a tough negotiator, said the 15% tariff applied "across the board", later telling reporters it was "the best we could get."
The deal, which Trump said calls for $750 billion of EU purchases of U.S. energy in coming years and "hundreds of billions of dollars" of arms purchases, likely spells good news for a host of EU companies, including Airbus(AIR.PA), opens new tab , Mercedes-Benz (MBGn.DE), opens new tab and Novo Nordisk (NOVOb.CO), opens new tab, if all the details hold.
The baseline 15% tariff will still be seen by many in Europe as too high, compared with Europe's initial hopes to secure a zero-for-zero tariff deal, though it is better than the threatened 30% rate.
German Chancellor Friedrich Merz welcomed the deal, saying it averted a trade conflict that would have hit Germany's export-driven economy and its large auto sector hard. German carmakers, VW, Mercedes and BMW were some of the hardest hit by the 27.5% U.S. tariff on car and parts imports now in place.
But Bernd Lange, the German Social Democrat who heads the European Parliament's trade committee, said the tariffs were imbalanced and the hefty EU investment earmarked for the U.S. would likely come at the bloc's own expense.
Trump retains the ability to increase the tariffs in the future if European countries do not live up to their investment commitments, a senior U.S. administration official told reporters on Sunday evening.
The euro rose around 0.2% against the dollar, sterling and yen within an hour of the deal's being announced.
Source: Fijian Broadcasting Corporation
