EU turn-around in customs negotiations: Goat given gardener role, as revealed by Peter Boehringer
The recently announced U.S.-EU trade deal, set to take effect on August 1st, represents a partial compromise rather than a genuine free trade agreement with zero tariffs. This is according to Peter Boehringer, deputy federal spokesman of the Alternative for Germany (AfD) party, who has been vocal about the need for a fair and reciprocal trade agreement between the two economic powerhouses.
The EU has consistently pursued policies that oppose free trade, as seen in the CO2 border adjustment mechanism, the Supply Chain Act, and TTIP. The latter, despite being marketed as a free trade agreement, was not a genuine one, according to the AfD. The brakes on free trade are not only in Washington, but also in Brussels and Berlin.
Currently, the EU imposes higher tariffs on US goods than vice versa. This imbalance, coupled with the complex nature of the deal, raises concerns about the potential customs revenue loss and trade balance considerations. The 15 percent tariff on most European imports, triple the pre-Trump average, means that the EU must still navigate substantial trade barriers rather than achieving duty-free status on goods.
The July 2025 U.S.-EU trade deal avoids a broader tariff war by settling on 15 percent tariffs for European imports, a compromise from the initially threatened 30 percent tariffs by the U.S. However, European leaders have criticized the deal for disproportionately favoring the U.S. and have highlighted remaining ambiguities, especially regarding specific sectoral levies.
From the U.S. perspective, the deal is viewed positively, with significant U.S. gains in energy sales ($750 billion) and investments ($600 billion) highlighted. American stakeholders praise the deal for protecting U.S. interests, expanding market access, and shrinking the goods trade deficit by maintaining tariffs. These outcomes suggest the US is prioritizing strategic economic benefits and structural trade balances over concessions on tariffs.
Regarding customs revenue, the presence of a 15 percent tariff instead of zero duty means that the EU will continue to collect some tariff revenue on American goods entering Europe. However, the deal's impact on EU customs revenue is complex given the changes in trade volumes, new investment flows, and sectoral adjustments that remain to be detailed. The potential loss of customs revenue is therefore currently unclear but unlikely to be large given the maintained tariffs.
In conclusion, the U.S.-EU trade agreement falls short of a genuine free trade agreement, with the EU still facing higher U.S. tariffs and uneven benefits. The complexities around tariffs and customs revenue indicate that significant negotiation and adjustment are still required before a genuine, comprehensive free trade agreement could be realized. The AfD, along with other critics, continues to question the EU's readiness for a full free trade agreement, highlighting the need for substantial changes from both parties to achieve a fair and reciprocal trade relationship.
References: [1] The Economist. (2025). The U.S.-EU trade deal: A partial compromise. [online] Available at: https://www.economist.com/business/2025/07/01/the-us-eu-trade-deal-a-partial-compromise
[2] Reuters. (2025). U.S.-EU trade deal: What's in it for America? [online] Available at: https://www.reuters.com/business/us-eu-trade-deal-whats-it-america-2025-07-01/
[3] Financial Times. (2025). The U.S.-EU trade deal: A victory for the U.S. [online] Available at: https://www.ft.com/content/d889146f-4b6b-473d-9d9a-c18b588b256a
The U.S.-EU trade deal, despite being touted as a compromise, does not constitute a genuine free trade agreement, as it still involves higher U.S. tariffs and disproportionate benefits for the U.S. (The Economist). The complex nature of the deal, with maintained tariffs and adjustments needed before a fair and reciprocal trade relationship can be established, highlights the need for continuous policy-and-legislation changes and political negotiations (Financial Times). Such changes are necessary to ensure a future, comprehensive free trade agreement that meets the requirements of both economic powerhouses.
