While the EU celebrates the avoidance of a severe trade war through a newly inked deal with the US, leaders from Germany and France voice deep concerns over its economic implications, indicating a divide in perspectives on the agreement's merits versus its potential risks.
EU Leaders Respond Cautiously to US Trade Deal, Highlighting Economic Concerns
EU Leaders Respond Cautiously to US Trade Deal, Highlighting Economic Concerns
Major EU figures express significant reservations following the trade agreement reached between Ursula von der Leyen and Donald Trump, emphasizing the potential economic fallout.
The trade deal recently struck between EU chief Ursula von der Leyen and US President Donald Trump has been met with a wave of skepticism from leaders of Europe’s two largest economies, Germany and France. German Chancellor Friedrich Merz characterized the agreement as one that would "substantially damage" the financial health of Germany, while French Prime Minister Francois Bayrou bluntly termed it "submission" to US interests.
Despite a predominantly pessimistic outlook, some EU nations acknowledge that accepting an uneven agreement might serve better than risking an outright trade war. The accord includes a 15% tariff on a majority of EU exports to the US—half of what Trump had initially threatened—while committing Europe to purchase more American energy and reduce taxes on certain imports.
During a private meeting at Trump’s golf resort in Scotland, von der Leyen hailed the agreement as a "huge deal," with Trump expressing that it would bring US-EU relations "closer together." However, the deal still requires ratification by all 27 EU member states, each with its own unique economic interests. No country has suggested it would obstruct the deal, but the atmosphere is far from celebratory.
Alongside Merz's warnings about the adverse economic effects this deal may have on both the US and Europe, Bayrou's critique resonated on social media, labeling it a "dark day" for an alliance founded on shared values. Notably, Hungarian Prime Minister Viktor Orban, a supporter of Trump, remarked that the US president had metaphorically "eaten von der Leyen for breakfast," showcasing the divided sentiments among EU leaders.
Other leaders, such as Spanish Prime Minister Pedro Sanchez, indicated a reluctant approval, stating support "without any enthusiasm." Nonetheless, some European officials recognized the deal as a necessary step toward achieving stability. Finland's prime minister echoed this sentiment, suggesting that the agreement would bring "much-needed predictability," while Ireland’s Trade Minister Simon Harris acknowledged its importance for jobs and investment.
In defending the deal, EU Trade Commissioner Maros Sefcovic reiterated that it represented the "best deal we could get under very difficult circumstances," citing the necessity of maintaining strong trade relations with the US in light of ongoing geopolitical issues, particularly the Ukraine war.
Leading up to the talks, there was increasing pressure among certain European leaders to leverage anti-coercion measures against Trump; however, the looming threat of 30% tariffs prompted the EU to reach this compromise deal, which, while still needing further technical discussions, is perceived to soften the anticipated economic blow.
Beware that initial feedback from businesses in the US has been limited in enthusiasm. The National Foreign Trade Council welcomed the avoidance of a trade war, yet expressed concern that even a short-term reduction in tariffs could risk long-term trust and isolation from a key ally. The prior tariff-exempt status had allowed both US and European industries like aerospace and pharmaceuticals to thrive, and lingering EU policies, which some view as onerous, remain a contentious point of discussion.
As the EU deliberates the details of this agreement, balancing economic interests and cooperative relations with the US will remain a critical issue for its leaders moving forward.
