European Commission President Ursula von der Leyen achieved a significant milestone with the recent announcement of a trade agreement with U.S. President Donald Trump in Turnberry, Scotland. Despite the uncertainty surrounding the negotiations, the deal marks a pivotal moment for both parties, especially in light of Trump’s previous threats of steep tariffs on EU imports.
The trade deal is intended to safeguard the world’s largest economic partnership, which boasts a staggering $1.7 trillion in annual trade, from the impending threat of a trade war. Although the deal is seen as a triumph for von der Leyen, it could inadvertently push the EU further away from an alliance that has long been considered foundational.
President Trump framed the agreement as one of the most important international relations accomplishments, emphasizing cooperation with the United States’ largest trading partner. His comments during the joint press conference were noted for their unusually positive tone towards the EU.
However, this perspective is not universally shared among European leaders. Following the announcement, French Prime Minister François Bayrou expressed concerns, labeling the day as a “dark day” for an alliance that should uphold shared values and interests without resorting to submission.
In contrast, German Chancellor Friedrich Merz and Italian Prime Minister Giorgia Meloni welcomed the agreement, albeit with caution. Merz acknowledged that the deal could come at a cost to the German economy, despite the EU’s necessity to accept the terms. It’s likely that EU member states will begrudgingly endorse the agreement when presented for approval.
Despite the general acceptance of the deal, there is significant apprehension about the uncertainties attached to agreements with Trump. The Turnberry deal lays the groundwork for further negotiations rather than representing a definitive resolution.
Specifics concerning the sectors impacted by the Section 232 Trade Expansion Act investigations remain ambiguous. Industries like semiconductors and pharmaceuticals are under scrutiny, and although it appears that EU pharmaceutical exports worth €120 billion in 2024 may be subjected to a 15 percent tariff, uncertainties persist regarding the long-term outcome of these investigations.
Trump has indicated that the existing 50 percent tariffs on steel will remain. Meanwhile, von der Leyen has suggested there will be tariff reductions and an establishment of quotas based on historical averages; however, definitive clarifications on these points are still required.
Tariff reductions, mentioned by von der Leyen, lack specificity in the U.S. communication, which raises questions about the extent of reductions for essential goods like aircraft, certain chemicals, and agricultural products. Furthermore, the White House’s focus on removing non-tariff barriers was not echoed by von der Leyen, suggesting that further negotiations on these topics are likely to be protracted and complex.
A centerpiece of the deal involves Trump’s reference to an EU commitment of $600 billion in new investments in the United States—a figure likely based on previously existing commitments rather than new investments. Companies such as Volkswagen and AstraZeneca have made considerable investment pledges, but the expectation that the EU would provide investment capital for relocating companies appears unrealistic.
Additionally, the EU’s commitment to purchase $750 billion in U.S. energy exports over three years raises questions about feasibility, given that total U.S. energy exports for 2024 were valued at $332 billion. Many European nations are skeptical about taking on the majority of U.S. energy exports, making this target seems like an overreach.
One outcome that seems certain from the Turnberry deal is the increased drive for the EU to pursue a form of economic security that diminishes reliance on the United States. European leaders may accept the 15 percent tariff as a preferable alternative to Trump’s previous 30 percent threat; however, they will remember that the U.S. initiated these tariff hikes and act accordingly.
During her press conference, von der Leyen highlighted the EU’s deals with other countries, including Indonesia, Mexico, and the South American trade bloc Mercosur, as well as ongoing negotiations with India. While the recent deal entails energy and defense purchases, many European leaders view these transactions as temporary measures rather than a permanent shift in energy strategy or defense procurement.
European nations are likely to use U.S. energy supplies to reduce a more dangerous reliance on Russian energy but remain unconvinced that U.S.-sourced liquefied natural gas is a long-term solution compared to homegrown renewable energy initiatives. Similarly, defense acquisitions for Ukraine and Europe may proceed independently of this agreement since European governments are growing more aware of the shortcomings of their defense industries and the need for self-reliance concerning geopolitical challenges.
The Turnberry agreement underscores a stark realization for the EU: expecting favorable treatment from the United States is unrealistic. The complexities tied to the deal highlight the need for more concrete commitments—something that could lead to frustration on both sides.
As the British have witnessed, securing promises from the U.S. can be intertwiningly challenging, especially with a president like Trump, whose focus might shift unexpectedly. European leaders should remain vigilant for the reemergence of uncertainties and misunderstandings, signaling the growing recognition that the U.S. may no longer be a reliable partner.
This dynamic indicates a dramatic shift in the landscape of international economic relations, suggesting a potential re-evaluation of alliances as the EU considers its future dealings outside the traditional dependence on American ties.
image source from：atlanticcouncil
