Brussels: European Union officials have indicated that a long-anticipated framework trade deal between the EU and the United States could materialize as early as this weekend. The breakthrough is expected just days before steep American tariffs on European imports are scheduled to take effect on August 1, threatening to further strain transatlantic economic ties.
The proposed agreement, while not a full-fledged free trade pact, is being designed as a stopgap to prevent a potential trade war. Sources familiar with the talks revealed that the deal would set a uniform 15% tariff rate on all EU exports to the U.S., thereby replacing the current mosaic of tariffs. However, contentious Trump-era tariffs including the 50% duties on European steel and aluminum would remain untouched, a major sticking point for EU negotiators.
A senior EU official speaking on condition of anonymity said, “We are closer than ever. The groundwork is laid. A political decision is all that’s left.” The final nod may come during a high-profile meeting scheduled for Sunday in Scotland between European Commission President Ursula von der Leyen and U.S. President Donald Trump. Observers believe the meeting could serve as the symbolic and strategic closing act to the ongoing negotiations.
Despite optimism in Brussels, skepticism still lingers in Washington. President Trump, in a statement to reporters Friday morning, downplayed the certainty of the deal, stating that the chances were “50-50 or less.” Nevertheless, his administration has delayed the imposition of additional tariffs until early August to allow talks to progress a sign that Washington is open to striking a compromise.
The looming tariff threat is particularly severe for the European automobile sector. Without a deal, auto exports from Europe could face tariffs as high as 25%, while a broader array of goods including food and industrial components would be subject to duties of up to 50%. European leaders, especially from export-heavy economies like Germany, have been actively lobbying to avoid such outcomes.
Germany’s Chancellor Friedrich Merz and France’s President Émilie Marchand have taken different tones in the negotiation process. While Merz urged for compromise to secure export markets, Marchand has insisted on a more cautious approach, emphasizing fairness and long-term industrial balance.
Investors across global markets have been watching the developments closely. Stock indexes in Europe showed slight gains Friday amid renewed hopes that a last-minute deal would reduce geopolitical risk and economic uncertainty.
However, trade analysts caution that this framework, even if finalized, is only a temporary arrangement. Major disagreements over digital taxation, agricultural subsidies, and industrial standards remain unresolved and will need to be tackled in future negotiations.
As the weekend approaches, Brussels and Washington stand at a crossroads. A successful deal would mark a rare moment of cooperation in an increasingly fragmented global economy. Failure, on the other hand, could revive fears of a full-blown transatlantic trade war — something neither side can afford as they navigate domestic political pressures and global economic headwinds.