Brussels and Washington issued a much-anticipated joint statement on Thursday sealing off the trade deal they attacked almost a month ago.
A statement like the attack in Scotland between President Ursula von der Leyen of the European Commission, President Donald Trump, is legally binding and that reductions in tariffs on automobiles will be applied in parallel with “initiating tariff procedures on US products.”
Currently, a 27.5% tariff charge is currently applied to EU vehicles and auto parts.
Trade Commissioner Malossyvchovich told reporters that the committee’s “solid intention” is to present legislative proposals and begin the process by the end of the month. In that case, he added that the rate of 15% would be retroactively applied as of August 1.
The document states that as of September 1, unavailable natural resources (such as cork), all aircraft and aircraft parts, general medicines, and their components and chemical precursors will benefit from a special regime that only applies to ordinary non-discriminatory tariffs (MFN).
Currently, only MFN tariffs apply to drugs and semiconductors, with a 15% rate set to kick in only if the US decides to raise its duties after the end of the 232 survey.
Wine, steel, defense equipment
The committee’s statement emphasizes that “both sides agree to continue to work ambitiously to extend this regime into other product categories,” but unfortunately for some EU countries like France, wine and spirit appear to be out of the list of exempt products.
Sifchovich emphasized to reporters that the EU “is very clear that this is very important to us.”
It appears that steel or aluminum has never collided with the current 50% tariff rate.
The statement alone is intended to address global challenges in sectors such as two-way and to work together to address “a mutually safe supply chain” that includes “custom-charge quota solutions for EU exports of steel and aluminum, and their derivatives.”
Senior Committee officials speaking on condition of anonymity emphasized that there is no specific timeline on either side to agree to steel and aluminum tariff allocations.
“Of course, we are eager to move forward as quickly as possible,” the official said, adding that quotas are “more difficult to negotiate” because they “have variables” than simple tariff cuts.
The text also confirms that EU companies will invest an additional $600 billion into the strategic sector, pledging to purchase US energy products worth $750 billion (€64.4 billion) and $4 billion worth of US AI chips through 2028.
The EU also undertakes to “significantly increase” the procurement of US military and defense equipment, as per the text. Commission officials argued that this was not in conflict with the Bullock’s plan to significantly increase its own defense industrial bases by the end of the decade.
They also emphasized that unlike investments in energy products and strategic sectors, there is no “specific commitments” in terms of spending.
Initially, the EU, which vowed not to compromise regulator autonomy, agreed to adjust three laws that Washington flagged as issues.
“Awful, total surrender.”
“This is the most advantageous trade deal the US has expanded to any partner,” said Sifchovichchu, who spent 100 hours negotiating with US counterparts over the past two months.
He describes it as a “first step,” further strengthening the economic connection between the two parties, bringing “strength and predictability” “to a “relationship,” deeper and more important to our business.”
“It also strengthens our broader transatlantic partnership, which is more important than ever in today’s complex geopolitical landscape,” he added.
Von der Leyen and his Council of Europe counterpart Antonio Costa both welcomed the joint statement, emphasizing that they would provide “predictability” and “stability.”
According to EU diplomats, the EU ambassador’s ambassador, who explained the content of the commissioner’s joint statement on Thursday morning, responded primarily in a positive response.
However, a former EU official, speaking on condition of anonymity, told Euronows that the joint statement was “a terrible, total surrender.”
“There is no interaction,” the former official said, “US tariffs are 15% and the EU is zero for all industrial products.”
For Bruegel think tank researcher Niklas Poitier, the deal remains a “very flawed agreement” that “will significantly worsen the trade relationship between the parties compared to last year’s location.”
Its legally binding nature also makes it vulnerable to deny Trump’s mercury policy.
“He is often a person who changes his mind, and I don’t think we’re completely out of the woods here. There’s always a chance he might resume some of the agreement,” Poitia told Euroneus.
