Leaders from France and Germany have reacted negatively to a new EU-US trade deal, concerned about its economic implications, despite a consensus on its necessity to avert a trade war.
EU Leaders Express Caution Over US Trade Deal Amid Economic Concerns
EU Leaders Express Caution Over US Trade Deal Amid Economic Concerns
The trade agreement between the EU and US has drawn a skeptical response from European leaders, who fear economic consequences.
European leaders are voicing their concerns about the recently agreed trade deal between the European Union and the United States, clinched by EU chief Ursula von der Leyen and President Donald Trump. German Chancellor Friedrich Merz described the deal as one that could "substantially damage" Germany’s financial standing, while French Prime Minister Francois Bayrou criticized it as a form of "submission" to US pressure.
The agreement entails a 15% tariff on most EU exports to the US, which is a reduction from the higher rates initially threatened by Trump. In exchange, the EU has agreed to purchase more energy from the US and to cut taxes on certain imports. Although the leaders acknowledged that finalizing an uneven deal was preferable to igniting a full-blown trade war, the mood within Europe remains somber.
In a meeting at Trump's golf resort in Scotland, von der Leyen emphasized the deal's significance, calling it a "huge deal," while Trump remarked that it would foster closer ties between the US and the EU. However, the proposal requires the assent of all 27 EU member states, each with distinct economic interests in trade with the US. While no country has explicitly indicated objections, the general sentiment leans towards disappointment rather than celebration.
Chancellor Merz forewarned that both economies would encounter adverse effects, further criticizing the negotiating team in Brussels for yielding to a US president intent on reshaping international trade relations. Prime Minister Bayrou lamented on social media, stating, "It is a dark day when an alliance of free peoples... resigns itself to submission."
Other European leaders expressed varying degrees of support, with Hungarian Prime Minister Viktor Orban praising Trump while Spanish Prime Minister Pedro Sanchez indicated his backing was "without any enthusiasm." Despite the prevailing discontent, some leaders noted relief in reaching a deal, with Finland's prime minister citing its provision of "much-needed predictability," and Irish Trade Minister Simon Harris calling it essential for fostering jobs and investments.
EU Trade Commissioner Maros Sefcovic defended the terms of the agreement, suggesting it was the "best deal" achievable under current circumstances, given the geopolitical landscape shaped by the Ukraine conflict. He emphasized the necessity of securing favorable trade relations with the US, which comes at a price.
Earlier discussions among European leaders about implementing anti-coercion measures to pressure Trump gave way to a more pragmatic approach. Striking an agreement was deemed preferable to the harsh tariffs that had been proposed. Though von der Leyen portrayed the deal as a success, even Manfred Weber of the European People's Party labeled it as "damage control."
Initial reactions from businesses in the US mirrored European apprehensions. The National Foreign Trade Council lauded the avoidance of a trade war as progress but cautioned that the short-term benefits of a 15% tariff may risk long-term trust and collaboration between the US and EU. It also highlighted existing EU policies that remain contentious, such as perceived unfair reimbursement practices in pharmaceuticals and the digital sector.
