Commerce Secretary Howard Lutnik outlined the details and anticipated impact of a newly negotiated trade deal between the United States and the European Union, signed in Scotland.
The agreement features new 15% tariffs on most EU exports to the US, elimination of EU tariffs on US goods, and significant commitments for EU investment and energy purchases from the US.
Discussions also covered ongoing and upcoming trade negotiations with other countries, including South Korea and China, with final tariff rates to be set by the end of the week.
The status of TikTok and its relevance to China negotiations was briefly touched upon.
Action Items
End of this week – President Trump: Set final tariff rates for ongoing and prospective trade deals.
Ongoing – Commerce Secretary Lutnik and Ambassador Greer: Continue discussions with South Korea and finalize deal terms as directed by the President.
Ongoing – US Trade Team: Monitor outcomes and commitments from EU businesses regarding the $600 billion investment in the US.
Ongoing – US Trade Team: Track progress of China negotiations, including the possible 90-day extension.
EU-US Trade Deal Details
The EU agreed to a 15% tariff on most of its $600 billion in annual exports to the US (excluding some goods like aircraft parts).
The EU will remove tariffs on approximately $400 billion in US exports, granting US businesses, farmers, and fishermen improved market access.
The EU committed to $750 billion in energy purchases from the US, aiming to shift procurement away from adversary nations.
European companies pledged an additional $600 billion in US investments during President Trump’s term, on top of their typical annual investment levels.
Status of Other Trade Negotiations
Trade deals with the United Kingdom, Philippines, Indonesia, Japan, and Vietnam have already been completed.
South Korea is actively seeking a new trade agreement, with discussions held in Scotland; further negotiations are pending the President’s decision.
President Trump is expected to finalize tariff rates for multiple countries by the end of the week; this will set the standard going forward for new agreements.
US tariffs have generated $124.3 billion in revenue this year, an 8% increase from last year.
China Trade Negotiations
Ongoing talks are taking place in Geneva, with the possibility of a 90-day extension being discussed.
The final decision on the extension and related issues will be made by President Trump.
TikTok is not currently part of the trade negotiation framework with China, but may be discussed as an adjacent issue.
Decisions
US-EU trade deal finalized — The EU will pay 15% tariffs on most exports to the US while removing tariffs on US goods, alongside commitments for energy purchases and investment; deal aims to correct trade imbalance and boost US economic interests.
Final tariff rates for pending trade deals to be set by week’s end — President Trump will decide rates, with all pending negotiations due for resolution.
Open Questions / Follow-Ups
Will President Trump approve a 90-day extension in China trade talks?
What specific measures are in place to ensure the $600 billion EU company investment commitments are fulfilled?
Will additional trade agreements with countries such as South Korea be completed before the end of the week?
Will TikTok become directly involved in US-China trade negotiations in the near future?