Donald Trump, President of the United States, has recently been negotiating with the European Union in response to the new tariffs imposed by the European community. The new measure will therefore affect European Union countries such as Spain. The Spanish Ministry of Economy, together with the US Embassy, is currently studying the effects on exports, imports, and the GDP. According to data from the Observatory of Economic Complexity, the impact of these tariffs must be taken into account. Read on to learn more.
Recent Donal Trump’s announcement: the new trade deal
Last Sunday President Donald Trump announced that the United States and the European Union ranged a framework for a trade deal, finally a monthslong time with America’s biggest trading partner.
Trump presented a 15% levy on most imports from the 27-nation European Union, taking into account automobiles, pharmaceuticals and semiconductors, after conversations with European Commission President Ursula von der Leyen in Turnberry, Scotland.
Speaking with von der Leyen at his golf course on the western coast of Scotland, Trump said the EU agreed to buy $750 billion worth of energy from the US, and make and investment of $600 billion more in the american country.
“All of the countries will be opened up to trade with the United States at zero tariffs, and they’re agreeing to purchase a vast amount of military equipment,” Trump added.
Agreement with the bloc as “the biggest deal ever made.”
At the time particulars of the deal have not been revelaed, Trump touted the pact with the bloc as “the biggest deal ever made.” Von der Leyen explained that the deal would be a reflection of “stability” and “predictability,” and other European leaders have truuly welcomed the development.
Generally, the EU and the US exchanged $975 billion worth of goods the previous year, according to US Commerce Department data. The trade deal, byt the time far from final, lowers the risk of a transatlantic trade conflict that would have ramifications for the global economy.
Trump intieated conversations with von der Leyen earlier Sunday as Friday’s deadline loomed to reach an agreement to not having to pay 30% tariffs on European imports. The European Union had sought to maintain baseline tariffs at 10%, while Trump had explained that the United States might not go lower than a 15% across-the-board tariff rate for the bloc.
Get to kown about Eurpean negotiatiors
Von der Leyen was conscious about negotiations with Trump were abput to be complicated: “I knew it at the beginning, and it was indeed very tough. But we came to a good conclusion for both sides.”
Germany’s Chancellor Friedrich Merz posted on X, saying European negotiators’ hard work had paid off. “A trade conflict has been averted that would have severely impacted the export-oriented German economy,” he said.
In addition, Italy’s Prime Minister Giorgia Meloni exposed that it was “positive” that a trade deal has been struck among the EU and the US, but said she wanted to see all information, Reuters reported.
The Irish Prime Minister, Taoiseach Micheál Martin, also opened arms to the deal, saying it was “good for businesses, consumers and investors” on X. However, he submitted that bilateral trade would still be “more challenging” with nowadays’ higher tariff.
What the 15% tarrifs includes
The 15% tariffs on all goods takes into account pharmaceuticals, the No. 1 ($155 billion) good the US comes from the European Union last year, according to US Commerce Department data. Trump had over and over suggested he would put a 200% tariff on pharmaceuticals that are manufactured out of the United States — the vast part of US drugs — starting August 1.
Ireland, a member of the EU, is the top single foreign country supplying the United States with pharmaceuticals. In addition, a German pharmaceutical association, vfa, warned of huge consequences for the industry. “
The new tariff rate is likely to not only result in significant additional costs for manufacturers, but also jeopardize international patient care,” the vfa said in a Monday press release.
One of the “largest trade deficits”
The framework arrives after Trump previously issued a tariff letter to the EU, communicating obligations on most EU goods would increase from the 10% universal baseline to 30% on August 1, as the US and European Union had one of the “largest trade deficits” and had not reached to get a a deal by his previous July 9 deadline.
In April, EU goods almost had to lead a 20% “reciprocal” tariff before Trump stopped those levies. And in May, Trump, citing a lack of progress in trade talks, explained that he was ready to slap a 50% tariff on EU goods on June 1.
Investors didn’t denied Sunday’s proposal. Europe’s benchmark Stoxx Europe 600 index grew to its highest level in more than four months on Monday. The index was trading 0.68% higher by early morning ET.
Trump affirmed again that the Friday deadline for other trading partners and explained steel and aluminum tariffs will be at their same current rates of 50%.
Sitting alongside Trump, Commerce Secretary Howard Lutnick said tariffs on semiconductors will be presented in two weeks. It’s not clear at ehich time those could take action.
Lutnick had said in an interview on “Fox News Sunday” that there would be no further extensions or grace timings after August 1. But he grown the prospect of potentially some wiggle room, saying “big economies” can keep trade conversations with the United States.
Several tariffs that Trump has threatened go as high as 50%. South Korea, the biggest provider of electronics and other goods, faces the menace of 30% tariffs, by the time Brazil could face tariffs of 50%.
In the meantime, the United States and China are getting close to August 12 deadline to scope a trade deal. The United States has been exchanging Chinese goods a tariff of around 50%, down from 145%, at the same time China has been taxing American goods at a minimum of 10%, down from 125%.
What Treasury Seccretary Scott Bessen is expecting to meet
Treasury Secretary Scott Bessent is awaited to meet with Chinese negotiators this incoming week in Stockholm for other round of trade conversations, looking for further extension of their trade truce reached in Geneva in May.
