“While it avoids open confrontation, it is already having concrete consequences for supply chains and increasing pressure on consumer prices on both sides of the Atlantic. The conditions for businesses and consumers remain much worse than they were before 2025. It should be remembered that the single rate of 15% currently on offer compares with much lower rates prior to April. Such an increase is likely to further weaken the competitiveness of European exporters,” says Fedil in a statement released Monday afternoon.
“A few elements of relief can, however, be mentioned. The aeronautical sector is excluded from the scope of the agreement and will not be subject to taxation. In addition, the reduction in customs duties on imports from the automotive sector from 27.5% (since April) to 15% is a positive signal for the Luxembourg suppliers concerned,” adds Fedil. “However, duties on steel and aluminium are not included in the agreement. They remain fixed at 50%, even if the introduction of quotas is envisaged. This uncertainty remains worrying.” The business federation is calling for a rapid and legally binding implementation of this agreement, as well as clarification of the many points still outstanding in order to ensure lasting trade stability between the European Union and the United States.
“More than economics, strategic calculation drove Brussels’ climbdown. Keeping Trump committed to Ukraine is fundamental for the EU. The bloc has already conceded on Nato spending, embracing the once-taboo 5%-of-GDP target. Intense lobbying from EU heads of states achieved a major victory in convincing Trump to (1) issue a harsh 50-day ultimatum to Russia, and (2) keep on arming Ukraine through EU-funded purchases. Picking a trade-fight that we could not win would have been a strategic long-term mistake in a myopic search for short-term economic gains. In this light, we can view these 15 points of tariffs as a premium for geopolitical insurance against Russia,” says the asset management firm Carmignac Benelux.
Mixed reactions
Does the government intend to act to mitigate the effects of these measures? asks majority MP 
“The agreement avoids a continued escalation of tariffs between the United States and the European Union, although it does pose significant unpredictability for the future. A return to international trade based on a relationship of trust and free exchange must be the common goal,” the ministry of foreign affairs said late Monday afternoon.
“I appreciate the constructive attitude… taken by the president of the European Commission,” Ursula von der Leyen, who negotiated this agreement with US president Donald Trump, “and I support this trade agreement, but I do so without any enthusiasm,” said the Spanish prime minister, the Socialist Pedro Sánchez, at a press conference in Madrid.
“It is clear that… we will have to work further on the agreement, because what was signed yesterday is a general, non-legally binding agreement,” Italian prime minister Giorgia Meloni told journalists on the sidelines of a visit to Addis Ababa. “The president of the commission has clearly indicated that certain sectors are particularly sensitive. I am thinking, for example, of pharmaceuticals, cars… We need to check what exemptions are possible, particularly on certain agricultural products,” she added.
“The agreement is an important step in limiting the serious uncertainty surrounding transatlantic trade relations in recent months,” commented the European car manufacturers’ lobby (ACEA) in a statement. However, the existing automotive tariffs will continue to have a “negative impact on the sector, not only in the EU but also in the US,” warned ACEA director general Sigrid de Vries. “Going forward, the EU and the US should focus on reducing barriers to the vital transatlantic automotive trade, paving the way for stronger economic ties and shared prosperity.”
“I am 100% sure that this agreement is better than a trade war with the US,” EU trade commissioner Maroš Šefčovič told reporters in Brussels. “This is clearly the best agreement we could have obtained in very difficult circumstances.”
Trump and and von der Leyen reached a customs agreement in Scotland on Sunday, setting customs duties at 15% on European products exported to the United States. Trump had threatened to apply a rate of 30% from 1 August in the absence of an agreement. At the same time, the EU has pledged to make $750bn in energy purchases--aimed in particular at replacing Russian gas--and to invest a further $600bn in the United States. At this very high price, the Europeans hope to avoid a trade escalation.
This article was originally published in French.
