European Union leaders convened in Brussels on Thursday to deliberate over a new trade proposal submitted by the United States. European Commission President Ursula von der Leyen confirmed that while negotiations are ongoing, the possibility of failure remains, noting that “all options remain on the table.”
The discussions come at a crucial time as the July 9 deadline approaches. If no agreement is reached, the temporary suspension of steep tariffs introduced during U.S. President Donald Trump’s tenure may lapse, affecting key European exports, including automobiles and pharmaceuticals.
The EU faces mounting pressure to form a unified stance. German Chancellor Friedrich Merz urged swift action, advocating for a “quick and simple” trade deal over a “slow and complicated” one.
However, French President Emmanuel Macron voiced caution, saying while France supports a pragmatic approach, “terms that were not balanced” would not be accepted. “Our goodwill should not be seen as a weakness,” he asserted.
French representatives have pushed for a more assertive EU response, including potential tariffs on U.S. services—a move not supported by all member states.
European Commission President Ursula von der Leyen disclosed that the EU received the latest U.S. proposal earlier on Thursday. One EU diplomat described the submission as a "two-pager, principle agreement," noting that the U.S. prefers to avoid sector-specific commitments at this stage.
Despite the limited details, the EU is actively assessing the offer, preparing for either a breakthrough or breakdown in the coming days.
Currently, European exports face U.S. tariffs of:
50% on steel and aluminium
25% on vehicles and parts
10% on most other goods—with a threat of that rising to 50% without a new agreement
In response, the EU has authorized—though not yet enforced—tariffs on €21 billion ($24.55 billion) worth of U.S. products. Leaders are now considering a broader package affecting up to €95 billion in American imports.
One of the EU’s potential countermeasures includes a digital advertising tax, which would impact U.S. tech giants like Google (GOOGL.O), Meta (META.O), Apple (AAPL.O), X, and Microsoft (MSFT.O). This could also help balance the existing U.S. trade surplus in services.
EU leaders also explored forming new trade partnerships with Asia-Pacific nations. German Chancellor Merz said such plans are in their infancy but could offer alternative pathways to resolve trade disputes, especially given that “the WTO doesn’t work any more.”
Macron reiterated his opposition to the Mercosur-EU deal in its current form, despite general support from other EU leaders, including Merz.
Apart from trade, leaders tackled a range of sensitive geopolitical issues:
Ukrainian President Volodymyr Zelenskiy urged the bloc to adopt a new sanctions package against Russia. “What’s needed now is a clear political message – that Ukraine is firmly on the European path, and that Europe stands by its promises,” he told the summit.
Slovakia and Hungary raised objections to the EU’s plan to end Russian gas imports by 2027. Slovak Prime Minister Robert Fico threatened to block the EU’s 18th sanctions package until his country’s concerns were resolved.
As the EU’s July 9 tariff deadline with the U.S. fast approaches, the Brussels summit has brought both urgency and division to the forefront. While Germany pushes for an expedited trade agreement to shield key industries, France remains cautious, demanding equitable terms.
With EU Commission President Ursula von der Leyen confirming receipt of a new U.S. proposal and warning that “all options remain on the table,” leaders must swiftly decide whether to strike a deal or prepare retaliatory measures. The possibility of digital taxes on U.S. tech firms, along with sanctions on Russian oil and gas, adds further complexity.
The summit also underscored ongoing concerns over Ukraine’s EU bid and energy security for countries like Slovakia and Hungary. As global alliances shift and the WTO’s role diminishes, the EU appears poised to forge new trade frameworks with Asia-Pacific nations. The coming weeks will be critical in determining Europe’s economic and diplomatic trajectory.