{"id":39815,"date":"2025-08-02T05:50:10","date_gmt":"2025-08-02T05:50:10","guid":{"rendered":"https:\/\/www.newsbeep.com\/uk\/39815\/"},"modified":"2025-08-02T05:50:10","modified_gmt":"2025-08-02T05:50:10","slug":"europes-trade-deal-with-the-us-was-dead-on-arrival-it-needs-to-be-buried-heres-how-to-do-it-georg-riekeles-and-varg-folkman","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/uk\/39815\/","title":{"rendered":"Europe\u2019s trade deal with the US was dead on arrival \u2013 it needs to be buried. Here\u2019s how to do it | Georg Riekeles and Varg Folkman"},"content":{"rendered":"

Ursula von der Leyen\u2019s Turnberry golf course deal has been rightly called a capitulation<\/a> and a humiliation for Europe. Assuming such an accord would put an end to Donald Trump\u2019s coercion and bullying was either naive or the result of a miserable delusion. The EU should now steel itself and reject the terms imposed by Trump<\/a>.<\/p>\n

Is this deal really as bad as it sounds? Unfortunately, it is, for at least three reasons.<\/p>\n

The blow to Europe\u2019s international credibility is incalculable in a world that expects the EU to stand up for reciprocity and rules-based trade, to resist Washington\u2019s coercion as Canada<\/a>, China and Brazil have, rather than condoning it.<\/p>\n

Economically, it\u2019s a damaging one-way street: EU exporters lose market access in the US while the EU market is hit by more favoured US competition. Core European industrial sectors such as pharma and steel and aluminium are left by the wayside. The balance also tilts in the US\u2019s favour in important sectors such as consumer goods, food and drink, and agriculture. Tariffs<\/a> tend to stick, so this is long-term damage. The EU even gives up its right to respond to future US pressures through duties on digital services or network fees.<\/p>\n

To top it off, von der Leyen\u2019s defence and investment pledges (for which she had no mandate) go against Europe\u2019s interest. The EU\u2019s competitiveness predicament is precisely one of net investment outflows. As international capital now reallocates under the pressures of Trumponomics and a weakening dollar, the case for Europe to become a strategic investment power<\/a> was strengthening. Von der Leyen\u2019s promise of $600bn in EU investment<\/a> in the US is therefore disastrous messaging.<\/p>\n

How could this happen? All EU member states wanted to avoid Trump\u2019s 30% tariff threat and a trade war, but none perhaps as much as Germany and Ireland, supported by German carmakers and US big tech firms. Yet Irish sweetheart digital tax deals, as well as BMW and Mercedes\u2019s plans to move production hubs<\/a> to the US (also to serve the EU market), cannot be Europe\u2019s future.<\/p>\n

EU governments were distinctly unhelpful in building the EU\u2019s negotiating position<\/a>. But in the end, it was von der Leyen who blinked and she has to take responsibility. Her close team took control in the closing weeks and went into the final meeting manifestly prepared only to say yes, which made Trump\u2019s steamrolling inevitable.<\/p>\n

Let\u2019s think of the counterfactual: if von der Leyen had stepped into the room and rejected these terms, Trump\u2019s wrath and some market turmoil may have ensued. But ultimately it would very likely have come to a postponement, a new negotiation and, at some point, a different deal that would not be so lopsided or unilaterally trade away deep and long-term European interests and principles. Instead, von der Leyen became a supplicant to a triumphant Trump.<\/p>\n

The situation is reminiscent of the final rounds of the Brexit negotiations<\/a> five years ago when von der Leyen similarly was giving in to unacceptable demands from Boris Johnson, only to U-turn under pressure from a steelier EU chief negotiator and a quartet of member states.<\/p>\n

Today, von der Leyen runs Brussels with a strong presidential hand and has largely done away with internal checks and balances inside the commission. That is her prerogative and her style, but the upshot should not be weak, ineffective and unprincipled dealings on Europe\u2019s major geopolitical challenges, from Trump to Gaza.<\/p>\n

The \u201cdeal\u201d in Scotland is in reality an unstable interim accord. Nothing is yet inked or signed; Washington and Brussels are already locking horns on its interpretation<\/a> and negotiations on the finer (and broader) points are ongoing. The 27 EU governments will inevitably get involved as the final deal needs to be translated into an international agreement and EU law. Some big powers \u2013 Germany and Italy seemingly \u2013 are on board, reluctant or not. However, internal political dynamics may change their calculations. Opposition parties and rightwing contenders who are a real political threat to leaders in Germany and France are already lambasting the deal.<\/p>\n

Unless von der Leyen strikes a dirty bargain with the member states, the European parliament will also have a say. The longtime chair of its trade committee, Bernd Lange, has set the tone for how the deal would be viewed there, calling it \u201casymmetry set in stone<\/a>\u201d and even \u201ca misery<\/a>\u201d. As details seep out on what von der Leyen has really agreed toand what the US expects from the EU, and all the consequences become clear, an already unpalatable deal may become even more so.<\/p>\n

Weakening US economic data and returning stock market jitters<\/a> show that Trump\u2019s negotiation footing is fragile. His new tariff threats<\/a> come with new extensions, up to 90 days in the case of Mexico, as his position is overstretched. For Europe, the lesson from the Brexit negotiations \u2013 one that von der Leyen ought to have grasped before now \u2013 is that nothing is agreed until everything is agreed. There is now an opportunity for EU governments and the European parliament to course correct and salvage something from this train wreck.<\/p>\n","protected":false},"excerpt":{"rendered":"Ursula von der Leyen\u2019s Turnberry golf course deal has been rightly called a capitulation and a humiliation for…\n","protected":false},"author":2,"featured_media":39816,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[84,1294,56,54,55],"class_list":["post-39815","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-economy","tag-uk","tag-united-kingdom","tag-unitedkingdom"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/39815","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=39815"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/39815\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/39816"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=39815"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=39815"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=39815"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}