Trade deal between the European Union and the USA: who will laugh last?

Since the announcement of the transatlantic deal on trade issues, comments have been flying thick and fast. Ursula von der Leyen has been accused of giving in to all of Donald Trump's demands in order to put an end - albeit a hypothetical one - to the uncertainty undermining the European economy. Trump triumphs and the Commission tries to justify its weakness. But is this deal really as disastrous as commenters say?

Ever since Donald Trump returned to the White House in January, Europeans have been anxious about the tariffs he intends to impose on European imports. He has issued several ultimatums, with various rates and deadlines, and has reversed course on several occasions. With just a few days to go before the deadline, the President of the Commission travelled to Scotland, where the American Head of State was staying, and negotiated an agreement between two presidential golf courses.

An objectively unbalanced agreement

Clearly, the agreement is very unfavourable to Europeans. Their exports will be hit by customs duties of 15% (and much more for products such as steel and aluminium), without any taxes being applied in return to US products. Ursula von der Leyen has also committed herself to an ambitious plan for investment in the United States, and for the purchase of energy and weapons. Eurosceptics – usually quick to support Trump and denounce the EU's claim to act on behalf of the 27 - are stigmatising the weakness and illegitimacy of the Commission President. Federalists are disappointed by her lack of audacity and her inability to overcome the eternal divisions and procrastination of Europe's leaders. Editorialists lament the image that this agreement gives of the Union, both internationally and at home: how can the Union be respected if it panders to the whims of Donald Trump and betrays the interests of its citizens in order to protect those of industrialists?

A clear admission of weakness

Since Donald Trump's first threats, however, the EU has been preparing its weapons, announcing possible retaliatory measures. The European institutions have discussed at length the possibility of imposing heavy taxes on certain American imports. They have also examined the use of the "anti-coercion" instrument that the EU recently adopted, which can, for example, block access to public procurement for companies from an unfriendly third country. More broadly, the tensions with Donald Trump served as a test case for the many statements made in recent years on the subject of a "geopolitical", "powerful" or "sovereign" Europe, its "strategic autonomy", its re-industrialisation, its return to realism in international relations, or its assertion of its place among the other major blocs. In the end, none of this materialised: the Commission negotiated an agreement that it pitifully defends by saying that it could have been worse and that, all things considered, it was the best thing to do.

Did the President really have a choice?

Many commentators believe that this disastrous agreement is the fault of the President of the Commission. She has a reputation - no doubt justified - for being a staunch Atlanticist. She is also criticised for taking orders from her political family (the EPP), and especially from the CDU, its German branch, which is more concerned with clarifying the rules of the game to which exporting companies are subject than with asserting the power of the Union or condemning the attitude of the American President. Generally speaking, Ursula von der Leyen has made little impression in terms of her ability to negotiate with Donald Trump. Experts such as Thierry Breton, former European Commissioner (2019-2024), and Jean-Luc Demarty, former Director General for External Trade at the Commission (2011-2019), have repeatedly questioned the very existence of the President's strategy.

However, given the attitude of the American President, the divisions between the Member States, the duplicity of certain European national leaders and the socio-economic and geopolitical stakes of the negotiations, it is hard to see how von der Leyen could have opted for open conflict. In the space of six months, Donald Trump has overturned all the principles and codes of international negotiations, leaving his partners - in Europe and the rest of the world - bewildered and perplexed. He shows little concern for the consequences of his decisions, and seems ready to escalate sanctions endlessly if his political interests so require. The heads of the European institutions and the leaders of the Member States are far more concerned about respecting alliances and treaties, and the impact of a possible conflict on economic growth and unemployment. Negotiations are fundamentally asymmetrical, because Donald Trump is not accessible to arguments of law and reason, and is clearly afraid of nothing.

A freewheeling President?

Contrary to what has been said here and there, the President of the Commission has not acted alone or without a mandate, and has not exempted herself from accountability. In trade matters, the Commission has a mandate from the Council of the Union; the representatives of the 27 define the broad lines of its action, the Commission negotiates on their behalf and regularly informs them of its progress. The President also acts on behalf of the College of 27 Commissioners, and does not have a free hand, given the principle of collegiality that governs the institution. Finally, she has to reckon with the opinion of the European Parliament, which, like the Council, must approve the trade agreements she signs, and can disavow her action at any time, including through a motion of censure.

Easy criticism

The commentators (national politicians, MEPs, business leaders, trade unionists, editorialists, academics, experts, etc.) who almost unanimously condemn the agreement are very convincing in their arguments, but they do not explain what they would have done in Mrs von der Leyen's place. They take care to detail the harmful consequences of the agreement, but do not mention those - economic but also geopolitical - of an absence of agreement, which they recommend, most often implicitly. At the last NATO summit, Donald Trump made no secret of his desire to link trade and security: no military support without a trade agreement. But can the European Union provide support for Ukraine on its own? Can it cope with a Russian offensive against one of its Member States without the support of the United States? From a socio-economic point of view, what would have been the consequences of customs duties of 30%, or more, on all European products exported to the United States? It would obviously be desirable for the Union not to submit to the will of a tyrant, but at what price? We have read and heard very few comments on this subject. And it is not certain that the critics of the agreement would have congratulated Mrs von der Leyen if she had told Donald Trump that the European Union refused to give in to his injunctions and threats.

A powerful Union, yes, but how?

Today, one no longer needs to be a fervent European federalist to call for a more united, more ambitious and stronger Europe, in an international context where relations between the blocs are becoming more strained, and where the logic of multilateralism, respect for what has been signed and loyal cooperation between nations is in sharp decline. Opinion polls clearly show that citizens want the Union to close ranks and take greater responsibility for security and defence. Negotiations with Donald Trump could have been an opportunity to assert Europeans' desire to take charge of their own destiny and proudly assert their values and their vision of the way the world should go. But how can the EU embark on such an adventure when, around the European Council table, there are several political leaders openly pledged to President Trump, others who are panicking at the idea of losing the American nuclear umbrella, and still others who are obsessed with the need to sell their manufactured products?

Affirming Europe's independence and sovereignty is a long and complex process that cannot be based exclusively on words and symbolic decisions. Conversely, the agreement negotiated by Ursula von der Leyen in Scotland is not the sign of a renunciation of any ambition for power on the part of the Union: it is merely an unfortunate episode in a wider process. Above all, there are two reasons to remain optimistic: the agreement is not legally binding, and many of the European promises are not binding on anyone.

A non-binding political agreement

Mrs von der Leyen and Mr Trump reached an agreement and exchanged a handshake, but they did not sign anything. Their agreement is similar to that between the United States and the United Kingdom: it is not based on a treaty, but on a reciprocal commitment to take unilateral decisions. The EU-US agreement could take the form of a treaty, but in that case it would have to be negotiated in detail, with a precise mandate from the Council. It would also have to be ratified by the Council by a qualified majority, and approved by a simple majority by the European Parliament. If the agreement were to take the form of a more ambitious treaty (such as the CETA with Canada or the EU-Mercosur Treaty), incorporating elements belonging to the competence of the Member States, it would then be a so-called "mixed" treaty, requiring a unanimous vote in the Council, the approval of the European Parliament, and ratification by all 27 national parliaments. This would be the case if, for example, the text included elements relating to the purchase of American military equipment. However, this is unlikely, as the risk of failure would be too great. For the time being, therefore, this is simply a political agreement. Many critics have noted this, believing that it will not prevent Donald Trump from revising his position whenever he wishes.

Promises are only binding on those who believe them...

The agreement is also based on numerous verbal promises made by Ursula von der Leyen: purchase of more energy, military equipment, investment in the United States, etc. On all these issues, she had neither the mandate nor the legal capacity to commit herself. In fact, the energy policies of the Member States remain very much their responsibility, and are largely based on the choices of private operators. Similarly, Member States are free to buy their military equipment wherever they wish, and we have seen recently that the strategies of the 27 in this area are very different. Nor can the Commission and the Member States force European investors to favour the United States. The trade agreement negotiated in Scotland is reminiscent of the one concluded last month at the NATO summit: the European states have undertaken to substantially increase their military investment, but this is not legally binding. The national leaders concerned know that Donald Trump will no longer be in power in a few years' time, and they will no doubt be very inventive in labelling all kinds of expenditure with no real link to defence as "NATO".

A good calculation in the medium term?

In a sea of sceptical, sarcastic and defeatist comments, there are two reasons to hope that this agreement turns out to be less bad than it seems.

Firstly, as we have seen, some of the promises made by Ursula von der Leyen are only binding on those who believe them. Clearly, Donald Trump likes victories and symbols of his greatness, intends to boast massive successes to his electorate, and cares little about the details. The promises that fall within the remit of the Member States and economic operators are no more than fine words designed to flatter the American President's ego and appease his wrath.

Secondly, this agreement demonstrates the need for the 27 to close ranks and gives them time to do so. These baroque negotiations are definitive proof that the Union can no longer rely on the United States - at least not as long as D. Trump or J.D. Vance are in the White House. American and European interests and conceptions no longer coincide, and the US President has made no secret of his deep detestation of the project and values of the Union. We must take note of this. The institutions of the Union and the Member States should therefore deploy medium- and long-term strategies to limit their dependence on the United States - whether in terms of trade, energy or security. As several European leaders have already indicated, the Union could take advantage of this turning point in international relations to take the lead in a coalition of States wishing to preserve and promote the principles of multilateralism - in contrast to the conceptions that now dominate in Washington and Moscow. The EU-US agreement can therefore be seen as a respite for Europeans, but only if they take advantage of it to get into fighting order.

Olivier Costa

Olivier.costa@cnrs.fr