A potential US-EU trade deal, nearing completion, could be framed as a “victory” for President Donald Trump while offering a sigh of relief for Europe. The EU is reportedly willing to accept 10% tariffs as part of a “framework” agreement to avert Trump’s threatened 50% tariffs on all EU exports, with a crucial deadline next Wednesday. This acceptance is conditional on an extension for talks and potential concessions on the 25% car tariff.
US Treasury Secretary Scott Bessent offered a positive outlook following his meeting with EU Trade Chief Maroš Šefčovič, remarking on the potential for a deal and the US’s broader aim for increased trade agreements. Further discussions are scheduled throughout Thursday afternoon with US Commerce Secretary Howard Lutnick and US Trade Representative Jamieson Greer, indicating the critical nature of these ongoing diplomatic efforts. Updates for EU ambassadors are anticipated on Friday.
President Donald Trump’s strict deadline of July 9th for imposing 50% tariffs on all EU goods has intensified the negotiations. This would be a dramatic increase from current tariffs, which already apply at 10% for most EU products and 25% for cars and parts. German Chancellor Friedrich Merz has been a vocal proponent of a swift, simple “agreement in principle,” emphasizing the urgency of removing the burden of existing high tariffs on businesses.
A key EU demand for any extension is a “standstill clause,” guaranteeing no new tariffs. While optimism exists for a deal by Friday, potentially providing Trump with a timely Independence Day announcement, the challenges are notable. Previous talks reportedly included a “massive tome” of US grievances, and the latest US proposal is said to lack details on American concessions, particularly on sensitive “red line” issues for the EU, such as strategic sectors, energy, and non-trade barriers.
