Transatlantic Trade Monitor: Facts You Need Now | The U.S.–EU Trade Agreement Is at a Crossroads

By Simon Kaye, CEO, Jaguar Freight

In late July, the U.S. and EU reached a provisional trade agreement to avert what could have become a full-blown trade war. A central provision of the agreement was that the U.S. would impose a 15% tariff on most EU exports, which was significantly lower than the previously threatened 30%, but triple the average 4.8 percent that European goods faced before Trump took office in January. In return, the EU pledged significant financial and energy commitments, including $600 billion in new investments in the U.S. and $750 billion in U.S. energy purchases through 2028.

A Done Deal?

Since the agreement was announced, however, it could be argued that more uncertainty and questions have come up than action and answers. To this point, only the headline tariff amount has come into force, with other major components of the deal still pending.

Taken all together, there are several reasons the agreement feels vague and unsettled despite the headlines.

The Countermeasures are on standby: Even though the EU’s planning retaliatory tariffs (a €93 billion countermeasure package originally set to kick in on August 7) have been suspended for six months. The “Trade Bazooka” package is not canceled. It’s a looming threat imposing political weight as talks continue.

Political fracture within the EU: Member states have diverged sharply on whether to accept the terms or push back more forcefully, complicating a unified EU position. Several EU member-states have expressed mixed reviews of the agreement since its announcement, with some comments being strongly worded. French Prime Minister François Bayrou labeled it a “dark day” and an act of “submission”. Many analysts expressed the opinion that the terms are deeply imbalanced. Others were more tempered, however. German Chancellor Friedrich Merz found the deal flawed but acknowledged its role in preventing escalation, while Italy’s Prime Minister Giorgia Meloni also offered measured acceptance.

Only partial enactment: The core tariff provision has taken effect, but key elements, such as for autos, spirits, and semiconductors, remain unbound and loosely scheduled. Adding to the ongoing uncertainty is that the EU recently stated it could not say when a joint statement on tariffs with the U.S. would be ready, despite officials saying a formal statement would follow the deal “very soon” along with executive orders from President Trump on key carve-outs. Tariff reductions on other categories, such as aircraft, wine, spirits, chemicals, and medical devices, are still under discussion, with no agreed scope or timing.

In short, many details remain undefined, including the mechanisms for how the aforementioned $600 billion in new investments and $750 billion in U.S. energy purchases will take place. For now, the agreement is serving as more of a framework than a salvaged trade deal.

Continued Uncertainty for Importers

Unfortunately, the status of the U.S.-EU deal is indicative of the general trade confusion many countries and companies are facing around the world. The other major U.S. trading partners, like China, Canada, and Mexico, are all dealing with similar (or even worse) uncertainty despite the occasional headlines that include deals being “made” or new tariff levels forthcoming with no formal documentation. Pretty much across the board, key details remain vague and very little feels settled.

The EU’s deal in its current form may offer a short reprieve from escalation, but without clearer definitions, binding commitments, and mutual reassurance, the uncertainty and internal backlash are going to linger. For now, the U.S.–EU trade agreement currently serves as a fragile ceasefire at best, rather than a finished and actionable framework to govern trade.

Compliments of Jaguar Freight – a member of the EACCNY