The United States and European Union clinched a trade agreement on Sunday that will see EU exports taxed at 15 percent, in a bid to resolve a transatlantic tariff stand-off that threatened to explode into a full-blown trade war.
US President Donald Trump emerged from a high-stakes meeting with European Commission President Ursula von der Leyen at his golf resort in Scotland, describing the deal as the “biggest-ever”.
The deal, which the leaders struck in around an hour, came as the clock ticked down on an August 1 deadline to avoid an across-the-board US levy of 30 percent on European goods.
“We’ve reached a deal. It’s a good deal for everybody. This is probably the biggest deal ever reached in any capacity,” said Trump.
Trump said a baseline tariff of 15 percent would apply across the board, including for Europe’s crucial automobile sector, pharmaceuticals and semiconductors.
As part of the deal, Trump said the 27-nation EU bloc had agreed to purchase “$750 billion worth of energy” from the United States, as well as make $600 billion in additional investments.
Von der Leyen said the “significant” purchases of US liquefied natural gas, oil and nuclear fuels would come over three years, as part of the bloc’s bid to diversify away from Russian sources.
Negotiating on behalf of the EU’s 27 countries, von der Leyen had been pushing hard to salvage a trading relationship worth an annual $1.9 trillion in goods and services.
“It’s a good deal,” the EU chief told reporters.
“It will bring stability. It will bring predictability. That’s very important for our businesses on both sides of the Atlantic,” she said.
She added that bilateral tariff exemptions had been agreed on a number of “strategic products”, notably aircraft, certain chemicals, some agricultural products and critical raw materials.
Von der Leyen said the EU still hoped to secure further so-called “zero-for-zero” agreements, notably for alcohol, which she hoped to be “sorted out” in coming days.
Trump also said EU countries — which recently pledged to ramp up their defence spending within NATO — would be purchasing “hundreds of billions of dollars worth of military equipment.”
