🇺🇸 US-EU Trade Deal Brings Massive Investment—but Tariffs Remain Untouched

Cairo: Hani Kamal El-Din

In a surprise development that sent ripples across global markets, the United States and the European Union have announced a sweeping trade deal. Touted as a major step toward economic alignment, the US-EU Trade Deal includes massive investments and energy cooperation—but conspicuously excludes the removal of the 50% tariffs on steel and aluminum imports, a sticking point in transatlantic relations since the Trump era.

According to The New York Times, the deal falls short of addressing the deeply contested tariffs imposed globally under the Trump administration. This omission is drawing mixed reactions from economic observers, with many questioning whether the agreement truly marks a turning point in US-EU economic relations.

A Presidential Announcement Full of Promise—And Ambiguity

On July 27, during a high-level meeting with the President of the European Commission in Scotland, the US President announced what he described as a “massive trade deal involving many nations.” He claimed that both sides agreed to open their markets to each other with zero tariffs.

However, the president did not mention the existing 50% tariffs on steel and aluminum, which remain untouched. As The New York Times clarified:

“The 50% tariff implemented by the Trump administration on global steel and aluminum imports is not part of this deal.”

This subtle exclusion has raised eyebrows, especially in European industrial sectors that were hoping for relief.

$1.35 Trillion in Trade and Investment—but at What Cost?

Despite the tariff issue, the US-EU Trade Deal comes with staggering economic promises. According to official statements, the European Union has agreed to purchase $750 billion worth of US energy exports, particularly liquefied natural gas and crude oil. Furthermore, the EU will invest $600 billion into the American economy, focusing on sectors such as infrastructure, green technology, and digital innovation.

While these numbers are impressive, analysts note that they reflect a heavily lopsided arrangement—where the US gains immediate benefits, while the EU secures only abstract promises of future negotiations on tariffs.

The Tariff Dilemma: Why Steel and Aluminum Still Matter

The 50% tariffs on steel and aluminum, first introduced in 2018, were a cornerstone of Trump’s “America First” trade policy. While these measures were intended to protect US industries, they severely impacted European exporters—particularly in Germany, France, and Italy.

European officials have repeatedly called for the removal of these tariffs as a precondition for any major trade pact. Yet, in the US-EU Trade Deal, these tariffs remain in place, raising concerns that the agreement is more symbolic than substantial.

Who Really Wins?

Given the balance of benefits, some trade experts argue that the US-EU Trade Deal primarily serves American interests. With massive energy exports and foreign investments heading into the US economy, the deal strengthens the US position in global markets—without requiring any painful policy reversals.

Meanwhile, the EU faces criticism from within for agreeing to such terms without securing relief for its manufacturing sector. European steel and aluminum producers, already under pressure from Chinese competition, may now find themselves at a further disadvantage in the American market.

A Strategic Move Amid Shifting Alliances

The US-EU Trade Deal comes at a time of geopolitical turbulence. The US is seeking to reinforce alliances amid rising global tensions and economic fragmentation, while the EU is aiming to reduce its dependence on Russian energy and Chinese tech.

In this context, the deal may serve broader strategic objectives—beyond pure economics. But the lack of tariff resolution means that the path to a fully normalized transatlantic trade relationship remains long and uncertain.

What’s Next for the US-EU Trade Relationship?

While the deal has been framed as a breakthrough, key issues still linger. The absence of tariff relief means future negotiations are inevitable. Experts anticipate new rounds of talks in coming months to address: