US and EU reach trade deal with 15 per cent US tariff on most EU exports amid Trump Scotland visit

Sky News AU

2 days ago

The United States and the European Union have reached a framework deal, with the US imposing a 15 per cent import tariff on most EU goods amid efforts to avoid a costly trade war.
The announcement comes during US President Donald Trump's visit to Scotland, where European Commission President Ursula von der Leyen met with Trump at his golf club on Sunday, local time.
"I think this is the biggest deal ever made," Trump told reports following the meeting between the pair, while Ms von der Leyen said the tariff applied "across the board".
"We have a trade deal between the two largest economies in the world, and it's a big deal. It's a huge deal. It will bring stability. It will bring predictability," she said.
The deal also includes $600 billion of EU investments in the US and $750 billion of EU purchases of US energy over Trump's second term.
The baseline 15 per cent tariff, which will be seen by many in Europe as a poor outcome compared with the initial European ambition of a zero-for-zero tariff deal, is better outcome than the threatened 30 per cent rate.
German Chancellor Friedrich Merz has welcomed the del, claiming in statement that a trade conflict had been averted that would have hit Germany's export-driven economy and its large auto sector hard.
The European Commission President's trip to Scotland comes after previous discussions between US officials and European Union trade chief Maros Sefcovic failed to produce an agreement.
Mr Sefcovic had flown to Washington DC after President Trump threatened to impose new 30 per cent tariffs on the EU unless the 27-member bloc could reach a trade agreement with the US by August 1.
Speaking to Reuters on condition of anonymity prior to Sunday's meeting, a Trump administration official was "cautiously optimistic" about the showdown talks, but warned it would be unwise to pre-empt an outcome.
"It's not over till it's over," the official said.
While the impact of escalating tariffs on China were felt by many US businesses and consumers, a trade war with the EU would likely be much more severe.
The US and EU are each other's largest trading partners by far and account for a third of global trade.
With Reuters