US, EU Reach Tariff Deal

The U.S. struck a framework trade agreement with the European Union on Sunday, imposing a 15 per cent import tariff on most EU goods.

At half the threatened rate, the move averts a bigger trade war between the two allies that account for almost a third of global trade.

The agreement calls for the EU to purchase US$750 billion of U.S. energy in coming years and hundreds of billions of dollars of arms purchases.

U.S. President Donald Trump and European Commission President Ursula von der Leyen announced the deal at Trump’s luxury golf course in western Scotland after an hour-long meeting.

Trump said the deal, which follows months of negotiations and tops a US$550 billion deal signed with Japan last week, would expand ties between the trans-Atlantic powers.

Von der Leyen, describing Trump as a tough negotiator, said the 15 per cent tariff applied across the board.

German Chancellor Friedrich Merz welcomed the deal, saying the alternative would have hit Germany’s export-driven economy and its large auto sector hard.

German carmakers, VW, Mercedes and BMW were some of the hardest hit by the 27.5 per cent U.S. tariff on car and parts imports now in place.