EU Finalizes US Trade Pact Amid Trump Tariff Threats
The USA and the EU are getting closer to inking a trade deal. Photo courtesy: Euronews.
European Union lawmakers and member states have reached a late-night agreement to implement a long-delayed trade deal with the United States, concluding months of internal negotiations. The breakthrough comes as US President Donald Trump warned of new tariffs unless the pact is ratified by July 4.
The compromise was finalized after intensive talks between EU capitals and European Parliament negotiators that stretched past midnight on Wednesday.
The 27-member bloc had originally struck a trade arrangement with Washington last July, under which most European exports would face a 15% tariff. However, the agreement still required final legal approval within the EU, a process that had stalled amid political disagreements and growing frustration in Washington.
Following the deal, Cyprus’s Energy, Commerce and Industry Minister Michael Damianos, whose country currently holds the EU presidency, said the agreement demonstrates that “the European Union delivers on its commitments.” He added that a “stable, predictable and balanced transatlantic partnership” serves the interests of both sides.
The EU now appears on track to meet Trump’s deadline to ratify the deal, which was originally agreed in Turnberry, Scotland, between Trump and European Commission President Ursula von der Leyen. Failure to do so could have triggered significantly higher US tariffs, with Trump already threatening to raise duties on European vehicles from 15% to 25%.
The broader tariff campaign launched by Trump, including measures on steel, aluminium, and auto parts, has pushed the EU to diversify its global trade relationships. However, the United States remains the bloc’s largest trading partner, with annual trade worth around €1.6 trillion ($1.9 trillion).
Key compromises in the agreement
To secure approval from member states, the European Parliament agreed to drop or soften several amendments that Washington had opposed.
One contentious issue was a stricter suspension clause that would have allowed the EU to withdraw tariff benefits for US exporters if Washington failed to comply with the deal. Lawmakers ultimately agreed to scale back this condition.
The final text also gives the United States until the end of the year to remove additional tariffs exceeding 15% on steel components, rather than requiring immediate removal.
Another dispute centered on “sunrise” and “sunset” clauses. A proposed “sunrise” provision—which would have delayed EU implementation until US commitments were fully met—was removed entirely. Meanwhile, the “sunset” clause, which would have set the agreement to expire in 2028 unless renewed, was extended to the end of 2029.
European Parliament Trade Committee Chair Bernd Lange, who led negotiations among divided political groups, said lawmakers had secured important safeguards.
He noted that the deal includes a suspension mechanism if the US fails to comply, a system to monitor economic impacts, provisions addressing unjustified tariffs, a built-in expiry date, and continued involvement of the European Parliament.
The parliament had already given conditional approval in March after months of delays linked to broader political tensions, including Trump’s remarks on Greenland and a US Supreme Court ruling that limited parts of his tariff policy.
The European People’s Party (EPP), the parliament’s largest group and the political family of Commission President von der Leyen, had strongly pushed for final adoption, arguing that the agreement is essential to reducing uncertainty for European businesses. (Source: france24.com)