US and EU Announce Major Trade Deal, 15% Tariffs to Commence August 1

US and EU Announce Major Trade Deal, 15% Tariffs to Commence August 1

The agreement has already received positive reactions, with German Chancellor Friedrich Merz welcoming the trade deal.

RMN News Trade Desk
July 28, 2025

US President Donald Trump and European Union (EU) chief Ursula von der Leyen have announced that the United States and the European Union have “reached a deal” on trade, aiming to resolve a prolonged transatlantic trade dispute. The agreement was hailed by both leaders as a “good deal for everybody”.

The announcement on Sunday (July 27) came after crucial discussions held at President Trump’s upscale golf resort in Turnberry, located along Scotland’s southwestern shoreline. Both leaders confirmed achieving a comprehensive agreement following private discussions.

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Key aspects of the newly announced trade deal include:

• 15% Tariff Rate: Under the agreement, America will impose a 15% tariff rate on products imported into the country from the EU. Earlier, Trump had maintained that EU export tariffs would remain at a minimum of 15% during the negotiations, and he explicitly stated “No” when questioned about the possibility of reducing this rate.
• Exclusion of Pharmaceuticals: Pharmaceutical products will be excluded from any trade agreement.
• EU Commitments: The European Union has pledged additional investments of $600 billion in the US and energy purchases amounting to $750 billion.
• Effective Date: Trump announced that “the deals all start on August 1”, with Washington emphasizing there would be “no extensions”. This date is significant as the EU bloc had previously faced a 30 percent US tariff unless a trade agreement was secured by August 1.

President Trump described the negotiations as “very interesting” and expressed his belief that the deal is “going to be great for both parties”. EU chief von der Leyen, representing EU member states, had been working intensively to secure an agreement to preserve the trade relationship, which accounts for $1.9 trillion annually in goods and services. At the start of the negotiations, she had stated that if an agreement was reached, “I think it would be the biggest deal each of us has ever” made.

The agreement has already received positive reactions, with German Chancellor Friedrich Merz welcoming the trade deal. Merz stated, “We have thus managed to preserve our fundamental interests, even if I would have wished for more relief in transatlantic trade”. These crucial discussions aimed to prevent trade sanctions and potential European countermeasures that could have triggered worldwide economic instability.