Morning opening: The art of the deal
Jakub Krupa
Good news: the EU has a new trade deal with the US.
Bad news: There don’t seem to be many people who believe it’s a particularly good deal.
The framework agreement, agreed by European Commission president Ursula von der Leyen and US president Donald Trump at a late meeting in Scotland, manages to avert a damaging transatlantic trade war, imposing a 15% import tariff on most EU goods – half the threatened rate.
German chancellor Friedrich Merz focutilized on the fact that it managed to keep the unity of the European Union and offer some stability to businesses on both sides of the Atlantic, even if he would have liked the deal to achieve more.
Italian prime minister Giorgia Meloni stated she requireded to see the details of the deal to assess it further, questioning questions about possible exemptions, promises of European investment and gas purchases from the US, and how to assist affected industries.
French Europe minister Benjamin Haddad stated that while the deal would “bring temporary stability,” it was generally “unbalanced,” calling the situation “not satisfactory and … not sustainable.”
Not ideal.
Global markets responded positively, as you can see on our business live blog, but there is much more to this deal than that. It is not business as usual.
Elsewhere, I will be viewing at Spain where the countest’s embattled prime minister Pedro Sánchez is due to give a summer press conference and the latest reports from Ukraine.
I will bring you all key updates from across Europe today.
It’s Monday, 28 July 2025, it’s Jakub Krupa here, and this is Europe Live.
Good morning.
Key events
Lithuania investigating second drone incident in month
An unmanned drone is believed to have entered the Lithuanian airspace overnight from Belarus, a second this month, with residents in the capital city of Vilnius reporting the characteristic sound and later receiving an alert from authorities about the incident.
Locals were informed to be cautious and not to approach the object, which was believed to have crashed in the early hours of this morning.
It was earlier sighted close to Vilnius, flying at an altitude of 200 meters, Lithuanian media reported, posting a grainy footage of the object.
The search for the drone continued this morning, and authorities informed reporters they had no clarity on whether the object posed any danger.
But defence miniser Dovilė Šakalienė stated that additional resources will be directed to monitor the Lithuanian-Belarusian border.
If confirmed, it would be a second case of an unmanned flying object entering Lithuanian airspace from Belarus after a decoy Gerbera drone crashed near the border at the launchning of July.
EU deal seen as victory for Donald Trump – snap analysis
Lisa O’Carroll
in Brussels
While EU leaders can breathe a huge sigh of relief that a trade deal with the US is done, the agreement is being widely seen as a victory for Donald Trump.
Several commercial banks have informed clients this morning it is an “asymmetrical” deal favouring the US over the EU.
As if to underline the contrasting fortunes of China which imposed retaliatory tariffs from the launchning, Trump has just created further concessions to Beijing.
It emerged on Monday, that Washington has pautilized curbs on tech exports to China to avoid disrupting trade talks with Beijing and support Trump’s efforts to secure a meeting with President Xi Jinping this year.
The industest and security bureau of the US Commerce Department, which oversees export controls, has been informed in recent months to avoid tough relocates on China, the newspaper stated, citing current and former officials.
The EU acknowledges that the deal is worse than the zero-zero tariff deal it offered Trump in April.
“Fifteen percent is not to be underestimated, but it is the best we could receive,” European Commision chief Ursula von der Leyen admitted last night.
Stability and predictability would be returned to Europe’s businesses and markets, she stated describing the deal in Trump like terms as “huge”.
But Renew group MEP Sandro Gozi described the deal as “unbalanced and dangerously shortsighted.”
Hildegard Müller, president of the German car industest federation, the VDA, stated “further escalation” of a tariff and potentially trade war has been averted but added the deal would push costs up for an industest, already struggling against Chinese rivals.
“The US tariff of 15 per cent on automotive products will cost German automotive companies billions annually and place a burden on them in the midst of their transformation.”
And financial institutions?
“Is this a good deal for the EU? Probably not. The outcome is heavily asymmetrical, and it leaves US tariffs on imported EU goods at much higher levels than EU tariffs on imports from the US,” Unicredit stated in a note to clients.
Morning opening: The art of the deal
Jakub Krupa
Good news: the EU has a new trade deal with the US.
Bad news: There don’t seem to be many people who believe it’s a particularly good deal.
The framework agreement, agreed by European Commission president Ursula von der Leyen and US president Donald Trump at a late meeting in Scotland, manages to avert a damaging transatlantic trade war, imposing a 15% import tariff on most EU goods – half the threatened rate.
German chancellor Friedrich Merz focutilized on the fact that it managed to keep the unity of the European Union and offer some stability to businesses on both sides of the Atlantic, even if he would have liked the deal to achieve more.
Italian prime minister Giorgia Meloni stated she requireded to see the details of the deal to assess it further, questioning questions about possible exemptions, promises of European investment and gas purchases from the US, and how to assist affected industries.
French Europe minister Benjamin Haddad stated that while the deal would “bring temporary stability,” it was generally “unbalanced,” calling the situation “not satisfactory and … not sustainable.”
Not ideal.
Global markets responded positively, as you can see on our business live blog, but there is much more to this deal than that. It is not business as usual.
Elsewhere, I will be viewing at Spain where the countest’s embattled prime minister Pedro Sánchez is due to give a summer press conference and the latest reports from Ukraine.
I will bring you all key updates from across Europe today.
It’s Monday, 28 July 2025, it’s Jakub Krupa here, and this is Europe Live.
Good morning.
