Just weeks ago, the terms of Europe’s trade deal with the US would have been considered an unthinkable surrender. But as Commission President Ursula von der Leyen admitted at a press conference shortly after the meeting, it was simply “the best we could get.”
Von der Leyen’s rare moment of candour underscores how weak Europe’s bargaining position has been from the outset. After nearly four months of quick concessions, tip-toeing negotiations, and unconvincing threats of countermeasures, the EU has finally accepted sweeping 15% US tariffs without retaliation, a yet-to-be-defined quota system on steel and aluminium, and promises to ramp up energy and military purchases from the US.
As reports of a European capitulation began to circulate on Monday morning, EU leaders said the deal would stabilise long-strained relations with the bloc’s largest trade partner and avoided the worse outcome of a full-blown trade war.
“If I were to sum up the EU-US agreement in one sentence, I would say it brings renewed stability and opens the door to strategic collaboration,” Maroš Šefčovič, the EU's commissioner for trade and economic security, told reporters on Monday.
Šefčovič, who acted as the bloc’s chief negotiator and has been shuttling back and forth to the US since President Donald Trump began his second term, urged Europeans to focus on the far greater damage potentially staved off by the agreement.
EU negotiators believed they were close to clinching a deal in early July, before Trump sent a bombshell letter to the European Commission announcing plans to impose a 30% baseline tariff on the bloc.
“With at least 30% tariffs, our transatlantic trade would effectively come to a halt, putting close to 5 million jobs … at grave risk,” Šefčovič said. “All in all, this is an agreement that generates mutual benefits.”
But behind the diplomatic talk, analysts says the outcome leaves the EU humiliated and weakened on all fronts — both economically and politically.
“What I worried about has happened. A completely unequal ‘deal’ between the US and the EU. Have no doubt: Asymmetric 15% tariffs are an EU defeat,” Olivier Blanchard, senior fellow at the Peterson Institute for International Economics, wrote on X.
For Nathalie Tocci, director of the Istituto Affari Internazionali think tank, the “terrible deal” struck by the EU raises a deeper question: why. “What’s perhaps more revealing,” she told The Parliament, “is understanding why the EU has, from the very beginning of negotiations, shown such profound weakness and reluctance to take retaliatory action — even in areas where it held more leverage.”
Steel, cars, and a big baseline tariff
While the details of the EU-US deal are yet to be hashed out, there’s little doubt that its core provisions are heavily tilted in favor of Trump’s America.
The EU is already grappling with a 10% baseline rate on all exports to the US, along with levies of 50% on European steel and aluminium, and 25% on car sales.
The new broad-strokes agreement includes a baseline 15% tariff on most European exports to the US, set to take effect on 1 August, along with a preliminary accord to establish a quota system for steel and aluminium. But with the quota terms still to be defined, the 50% tariff on the metals remains in place — at least for now.
EU officials expressed optimism that a steel deal could be finalised soon. “The EU provides specialty steel that the US desperately needs,” a senior Commission official said during a technical briefing on Monday.
If there’s a winner on the EU side it’s the automotive sector, which will see its targeted tariffs of 25% replaced by the new baseline of 15% on 1 August — a relief for major car-making nations like Germany, Italy and France.
The EU has also vowed to buy more military equipment from the US, and to purchase $750 billion of American energy products over the rest of Trump’s term — a commitment that EU officials insist is in line with the EU’s attempt to phase out Russian energy entirely.
The 27-member bloc also pledged a total of $600 billion in investment into the US economy — although the Commission was keen to point out that this reflects only projected investment by European companies, rather than the direct public investment envisaged in the US-Japan deal. “These figures are not taken out of thin air,” said the same official.
‘As good as it gets’
In the not-so-distant past, the EU argued that even US tariffs of 10% would meet with retaliation. That fighting spirit was nowhere to be seen in Scotland over the weekend.
“The agreement makes for a clear-cut political defeat for the EU, which has, in the course of the negotiations, punched below its economic weight and missed the opportunity to credibly leverage countermeasures at an early stage,” David Kleimann, a senior research associate at the ODI think tank, told The Parliament.
But other analysts argued that the final negotiating position adopted by EU leaders reflects the weakenss of their economy, rather than evidence of being outwitted by a superior negotiator.
“It's the kind of deal that a year ago would be unthinkable but, given the current circumstances, it's probably as good as it gets,” Aslak Berg, a research fellow at the Centre for European Reform, told The Parliament. He argued that most European exporters will remain competitive under a 15% tariff, meaning the outcome is “better than the worst-case scenario of a complete break.”
Kleimann said the deal would redefine the transatlantic terms of engagement. “The EU has chosen to retain strategic dependence on the US for the time being,” he said.
That the new agreement will mark a profound shift in the way the EU perceives and interacts with the US is something European leaders seem to have accepted since Trump began issuing threats in early April.
“It’s clear that the world before 2 April is gone,” Šefčovič said on Monday.
Sign up to The Parliament's weekly newsletter
Every Friday our editorial team goes behind the headlines to offer insight and analysis on the key stories driving the EU agenda. Subscribe for free here.