France and Germany Express Discontent Over New US-EU Trade Agreement

Leaders from France and Germany have voiced their concerns regarding the recent trade agreement between the EU and the U.S., signaling a potential economic downturn as Europe commits to increased American energy imports.

In a bleak response, leaders from Germany and France criticized the trade deal reached between EU Commission President Ursula von der Leyen and U.S. President Donald Trump, suggesting it poses significant risks to European economies. German Chancellor Friedrich Merz expressed that the agreement could "substantially damage" Germany's financial standing. French Prime Minister Francois Bayrou described the pact as equivalent to "submission" of European interests.

Despite the overall pessimism, some European nations acknowledged the necessity of the agreement to prevent a full-scale trade war, even as it introduces a 15% tariff on most EU exports to the U.S., significantly lower than the initial rates proposed by Trump. In exchange, Europe will commit to purchasing more energy from the U.S. and reducing taxes on specific imports.

The details of the deal emerged after von der Leyen's discussions with Trump at his Turnberry golf resort in Scotland, where both leaders characterized the accord as a step towards closer ties. While the agreement requires ratification from all 27 EU member states, indications suggest no country intends to block it, though celebrations are notably absent.

Merz warned of the negative economic impact for both Europe and the U.S., noting the limited scope for better terms against an assertive U.S. administration. Bayrou's sentiments were more severe; he labeled the deal as a significant setback for European unity and values.

Adding to the mixed reactions, Hungary's Prime Minister Viktor Orban, supportive of Trump, made light of von der Leyen's position, while Spain’s Prime Minister Pedro Sanchez expressed tepid backing for the deal. However, there were hints of relief among some leaders over a deal being struck, as Finland's prime minister emphasized its potential to restore some economic predictability, with Ireland's Trade Minister highlighting the importance of job security.

In defense of the terms, EU Trade Commissioner Maros Sefcovic claimed the pact represented the best outcome under challenging circumstances, emphasizing the geopolitical necessity of maintaining strong ties with the U.S. amid crisis scenarios like the ongoing conflict in Ukraine.

As discussions progressed leading to the final agreement, a faction within Europe had sought to toughen their stance against Trump by implementing measures that would block U.S. firms from European markets. Yet with the threat of even higher tariffs looming, the EU opted for a compromise that mitigates immediate economic harm, albeit still inflicting damage that many leaders feared.

Although von der Leyen initially framed the deal as a success, even members of her party later reframed it as "damage control." The specifics of the agreement are still under negotiation, and initial responses from the business community in the U.S. lacked fervor, with the National Foreign Trade Council noting that, while avoiding a trade war is a positive step, long-term relationships may suffer due to ongoing contentious EU policies.