Major US-EU Trade Agreement: A Mixed Bag of Winners and Losers

Mon Oct 20 2025 23:58:46 GMT+0300 (Eastern European Summer Time)

The landmark trade deal between the US and EU, negotiated in Scotland, raises questions about its implications for various sectors and economies.

While US President Trump heralds the deal as a victory, ordinary Americans and specific European sectors, like pharmaceuticals and car manufacturing, may bear the brunt of the new tariffs.

The US and EU have reached what is being characterized as the most significant trade deal in history, following negotiations in Scotland. While it resembles a preliminary agreement rather than a finalized trade pact, the outlines provided by President Donald Trump and EU Commission President Ursula von der Leyen reveal potential impacts across various sectors and stakeholders.

**Trump's Claim to Victory**
Trump is poised to celebrate, as this agreement is pivotal among trade deals he has pursued. Analysts, including Capital Economics, suggest that the EU has conceded more ground, potentially resulting in a 0.5% dip in EU GDP. The arrangement will likely see billions in import taxes flow into the US, though persistently high inflation and economic indicators released later this week could challenge the anticipated boost Trump hopes for.

**American Consumers Facing Trends**
The general American populace may not benefit from this deal; instead, they could see elevated prices as tariffs on EU products could lead to rising costs of living. The 15% tariff on imported EU goods stands as a significant barrier, impacting the prices consumers encounter at stores.

**Market Reactions**
Stock markets in both Europe and Asia showed positive responses following the announcement. The 15% tariff is viewed as less severe than expected, giving investors some reassurance that will further bolster the Euro against other currencies.

**Disunity in EU Responses**
Reactions within the EU reveal cracks in unity, with some members praising the deal while others express deep concerns. French Prime Minister Francois Bayrou reflected disappointment in the EU's submission to US demands, echoed by Hungary's Viktor Orban, suggesting internal discord could complicate the ratification process.

**Impact on Automotive Industries**
German automobile manufacturers may not welcome the reduced car tariffs from 27.5% to 15% as a complete victory. While the latest tariff changes lessen burdens on US automakers, the complex international assembly of American vehicles might still put domestic companies at a disadvantage against European rivals.

**Pharmaceutical Uncertainty**
European pharmaceutical sectors face an ambiguous fate under the new agreement regarding tariffs on medications. Despite aspirations for low rates, confusion persists about actual levies on drugs, disappointing many in the industry that had hoped for more favorable terms.

**US Energy and Aviation Gains**
Trump announced that the US will sell $750 billion worth of energy to the EU, seizing an opportunity for energy security post-Russian gas reliance. Additionally, the aviation sector stands to benefit as key products such as aircraft and components remain tariff-free, allowing smooth trade exchanges.

President Ursula von der Leyen remains optimistic about future negotiations aimed at establishing more "zero-for-zero" agreements, particularly for wines and spirits. This trade deal marks a significant development but raises more questions about long-term consequences for diverse stakeholders in both regions.