New Trade Deal Signed Between the U.S. and EU

It can be said with certainty that since President Donald Trump took office for the second time earlier this year, global economies and trade have been marked by uncertainty. High tariffs have been introduced, frozen, reduced, and then reintroduced. Stock markets around the world have been affected, and the situation has remained unpredictable.

Headlines containing the word “trade war” have appeared in newspapers for months, and fears over what this might lead to have been significant. For Europe, however, this uncertainty has been greatly reduced, as the U.S. and the EU reached a trade agreement on Sunday after months of negotiations.

Although the signed agreement is expected to bring greater predictability, it has already faced considerable criticism. The new agreement includes a 15 percent tariff on goods made in the EU, while American goods will not be subject to any tariffs. Furthermore, the EU will purchase American energy worth 750 billion dollars over the next three years and increase investments in the U.S. by more than 600 billion dollars. However, certain products will be exempt from tariffs. According to Aftenposten, these include airplanes, aircraft parts, certain chemicals, some medicines, semiconductor components, and select agricultural products.

It is important to highlight that significant uncertainties remain regarding this agreement, and it has faced criticism from several European leaders, including France’s Prime Minister François Bayrou. Several analysts have stated that the EU should have taken a tougher stance when Trump announced tariffs against multiple countries worldwide on April 2nd, similar to China’s approach. It is nonetheless important to point out that several European leaders support the agreement, as the goal is to ensure greater stability in the European economy and job market.