EU and US trade agreement confirmed following secret negotiations
The EU and US trade agreement has been confirmed following lengthy negotiations between President Donald Trump and European Commission President Ursula Von der Leyen in Scotland. This new EU-US trade agreement news puts an end to months of tension between the two largest trading partners globally.
The deal establishes a 15% tariff on European products in America. Trump previously threatened to increase the tariff to 30% in case there was no deal. There are certain items, such as planes, aircraft parts, some agricultural products, and some chemicals, that will not have a tariff at all.
Trump refers to it as a big deal for both parties
The agreement was reached after closed-door negotiations at Trump’s Turnberry golf course. Trump described the deal as “a good deal for everybody” and indicated that the EU and US agree trade deal will bring the two closer.
Von der Leyen stated that it was a difficult conversation, but she was pleased that Europe and the US could trade freely without fear of increased taxes. She termed it a huge deal that would usher peace and stability for business.
Europe will also invest a lot of funds in America. There will be $600 billion in US energy, oil, gas, and nuclear fuel. This will make Europe less reliant on Russia for energy.
Why this EU-US trade deal is important
Trade between Europe and the United States is quite huge. Their trade was approximately $976 billion last year. America purchases a lot of goods from Europe, such as cars, drugs, cheese, and electronics. Europe also purchases a lot of services and technology from America.
If there had not been a deal, both of them had intended to impose heavy taxes on the other’s goods. That would have made it costly for people and damaged jobs.
This new EU and US trade agreement is such that the two can now work towards collaborating. Certain tariffs, such as the 50% tax on steel and aluminium, will remain.
Trump referred to it as “the biggest deal ever made,” and Von der Leyen said this is the start of improved trade between the EU and the US.
FAQs
1. What is the new EU and US trade deal?
It is a deal where the US will impose 15% tariffs on European products and Europe will invest in the US.
2. What EU products are US tariff-free?
Aircraft, aircraft parts, some agricultural items, and some chemicals will be tariff-free.
3. How will prices be impacted by the EU-US trade deal?
With 15% taxes, certain European products in America might be costlier. But the agreement prevents much higher taxes (30%) that were previously on the agenda.
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