The United States and the European Union on Thursday published much-anticipated details of the trade agreement they struck verbally last month.
The deal will see the US maintain high tariffs on vehicles imported from the 27-nation bloc until it takes steps to lower its levies on many American industrial and agricultural products.
The terms, outlined in a joint statement by both parties set a clearer framework for a truce announced in July that averted a damaging tit-for-tat escalation in President Trump’s punishing global trade war.
Deal Details
Under the trade deal, the United States will maintain a 15% tariff on most goods arriving from E.U. member countries, including pharmaceuticals, even after the United States finalizes an expected set of tariffs for foreign-made medicines that could be as high as 200 percent.
The United States would however not immediately relax tariffs it has imposed worldwide on foreign-made vehicles, currently set to 27.5% for European carmakers. Rather, both sides agreed that the United States would lower those tariffs to 15% only after Europe takes steps to follow through on its commitments to lower tariffs on imported American goods.
Specifically, Europe must “formally” introduce legislation that would relax duties on industrial goods and agricultural products, including bison, tree nuts, dairy and many types of seafood, before lower car tariffs will kick in.
Additionally, from September 1, the US will apply only MFN tariffs on EU aircraft/parts, generics, chemical precursors, and scarce natural resources, the EU is also expected to buy $750B in US LNG, oil, and nuclear products in addition to at least $40B in US AI chips Investment & Cooperation:
EU firms are also to invest $600B in US strategic sectors by 2028 as well as exploring cooperation on steel and aluminum market protections. There is also a joint commitment to tackle digital trade barriers; EU pledges not to adopt network usage fees
