Trade Tidbits – July 30, 2025

TYFYATTM: I’ll seE-U in Scotland

Last we left things, European Commission President Ursula von der Leyen announced she’d be meeting up with President Donald Trump while he was in Scotland, and I noted that a surprise, unscheduled weekend meeting would seem to indicate a deal was close. And it was.

Unlike some of the other deals, though, President Trump’s truth feed was pretty tame: “President Trump announces a Landmark Trade Deal with the European Union” with a video of he and President von der Leyen talking about it. No TYFYATTM. No random capitalizations. NO ALL CAPS. No over-the-top language. Sad! President von der Leyen somewhat saved the day when she called it, “The biggest trade deal ever.”

So what’s in it? A White House fact sheet noted the following:

• The EU will pay a 15% tariff rate, “including on autos and auto parts, pharmaceuticals, and semiconductors” but steel, aluminum, and copper are unchanged at 50% (sidebar: continue to pay a 50% copper tariff, huh?)
• The EU will purchase $750 billion in U.S. energy and make $600 billion in new investments by 2028; there’s also a reference to purchases of chips and military equipment
• The EU will “remove significant tariffs, including the elimination of all EU tariffs on U.S. industrial goods exported to the EU” and provide “meaningful quotas for other products”
• The EU will “work to address a range” of non-tariff barriers, including on ag products, with pork and dairy singled out
• The U.S. and EU will work on strong rules of origin to ensure benefits accrue to the U.S. and EU, not third countries
• The U.S. and EU “intend to address unjustified digital trade barriers,” including that the EU won’t “adopt or maintain network usage fees” and will “maintain zero customs duties on electronic transmissions”
• The U.S. and EU will coordinate on non-market policies of third parties, inbound and outbound investment review coordination, export controls, and duty evasion

The EU released a fact sheet too. It says:

• The EU will pay a 15% “single, all-inclusive U.S tariff ceiling” – all EU imports below 15% will be at 15% and anything with a rate higher than 15% will stay at that rate; it also notes that the 15% ceiling applies to autos and auto parts, pharmaceuticals, and semiconductors
• The U.S. will bring tariffs on certain products – “aircraft and aircraft parts, certain chemicals, certain drug generics or natural resources” to pre-January levels
• The U.S. and EU will establish tariff-rate quotas at historic levels on steel, aluminum, and copper
• The EU will eliminate low-level duties on U.S. industrial goods; provide additional market access for Alaska pollock, Pacific salmon, shrimp, soya bean oil, planting seeds, grains and nuts, ketchup, cocoa, and biscuits
• The U.S. and EU will work together on auto standards and ag non-tariff barriers
• The U.S. and EU will work together on investment screening and export controls
• The EU will buy €700 billion in LNG, oil, and nuclear energy products; €40 billion in AI chips; and €550 billion of investment in various sectors by 2029

The EU fact sheet also notes that the fact sheets are “not legally binding.” Reuters adds a few details from an anonymous EU official:

• The 15% rate applies to other 232s, including “timber, trucks, critical minerals, commercial aircraft, polysilicon, and drones”
• Zero-for-zero tariffs on wine and spirits (spirits are more advanced than wine)

Got all that? Good. Now comes the hard part: the details. For example, there’s a little bit of confusionon the pharma tariffs. But both sides are racing to have a legally-binding deal by Friday. Because it’s the EU, the “legally-binding” aspect of the deadline presents a particular challenge since a qualified majority of countries would need to approve it, as well as the European Parliament potentially.

Still, President von der Leyen sold the deal as “the best we could get.” Trade Commissioner Maros Sefcovic would agree, based on this Wall Street Journal tick-tock talking about the hours he put in (including a golden retrievers interrupting a phone call). The article also noted the 50% tariff threat broke a negotiation logjam, which is what it seemed like at the time. The negotiations also broughttogether longtime WTO foes Boeing and Airbus.

Commerce Secretary Howard Lutnick also told CNBC there was “plenty of horse-trading still to do,” flagging digital services taxes and other tech regulations – though it sounds like those are longer-term issues.

A few more things to note. The EU will also delay its retaliation by six months. Treasury Secretary Scott Bessent said tariff could snap back if the EU doesn’t hold up its end of the bargain. And the White House and USTR flagged positive statements about the deal from industry and Capitol Hill.