We Must Prepare for the Post-Turnberry Era
One year after the EU-US tariff agreement, transatlantic relations remain unstable. Brussels must now define its strategy for the deal’s expiry and the next US presidency. A commentary by Moreno Bertoldi, and Marco Buti
A year ago, on July 27 2025, the European Union and the United States reached a major trade agreement at Donald Trump’s Scottish resort.
The deal raised tariffs on EU exports to the US to 15 per cent, removed tariffs on American exports to Europe and committed the EU to purchasing hundreds of billions of dollars’ worth of US goods. It also pledged $600bn of European investment in “strategic sectors” in the US by 2028, with no reciprocal commitments.
One year on, how should the agreement be assessed? Its economic and political implications need to be considered separately.
On the economic front, the verdict is mixed. Detailed studies show that about 90 per cent of the tariffs are being paid by US companies and consumers themselves.
A European response leading to a trade war, however legitimate, would have benefited no one. A robust retaliation would have been justified only if it had persuaded Trump to moderate his position.
The EU missed its moment in April 2025, following the shock announcement of reciprocal tariffs in the White House Rose Garden. The weakening of equity and bond markets, together with the fall in the dollar, had created an opening that Europe should have exploited to force the US into genuine negotiations.
But the necessary political courage was lacking. Once that window of opportunity had closed, the outcome was inevitable.
On the negative side of the ledger, contrary to the claims made by the agreement’s supporters, transatlantic economic relations have not become more stable or predictable.
There is also the weight of the commitments unrelated to tariffs, namely purchases of US goods and European investment in the US. The EU tends to regard these as little more than statements of intent, but Washington will insist that they are binding.
It is on the political front, however, that the flaws in the agreement become clearest. Appeasing the autocrat has failed to produce the desired results.
The experience of the past year shows that, for the remainder of his term, Trump intends to continue extracting resources from the EU and aggressively pursuing his America First agenda.
He will do so by threatening new tariffs and economic retaliation against countries that have introduced digital services taxes, or that, like the EU, have adopted standards and regulations in strategic sectors such as digital services and artificial intelligence that US technology giants dislike.
There should therefore be no illusions. The Trump administration will continue to foster confrontation in order to secure further concessions and satisfy the demands of the economic interests that support it politically and financially. The EU must prepare for two and a half turbulent years.
If it is to withstand Trump’s pressure, the EU will need to make operational the economic deterrence instruments already at its disposal, which it has so far been reluctant to use, starting with the Anti-Coercion Instrument.
More importantly, the EU needs a strategy for the post-Turnberry era. The agreement will expire at the end of 2029, no later than December 31, and negotiations over its renewal will coincide with the first year of the next US presidency.
If a Republican occupies the White House, they will almost certainly push for the Turnberry agreement to be renewed. Pressure over digital services and artificial intelligence will continue, with the aim of weakening regulatory constraints and discouraging the introduction of sector-specific taxes. What, then, will Europe’s position be?
In our view, the EU should seek to improve the agreement, particularly by making clear that the commitments on purchases and investment in the US are not binding. It should also try to make the deal less unbalanced by reducing some tariffs and stating unequivocally that its digital sovereignty is not negotiable.
If the next president is a Democrat, there is likely to be more room for manoeuvre, as the new administration will want to signal a break with the Trump presidency and restore strong ties with America’s traditional allies. Yet even in this scenario, the deterioration in the US fiscal position would make it far from straightforward for a Democratic administration to remove the tariffs introduced by Trump.
The EU must therefore decide in advance what minimum revision of the Turnberry agreement it would consider sufficient to restore a privileged and co-operative relationship with Washington.
Nor will the contentious question of taxation and regulation of digital services and artificial intelligence simply disappear when the occupant of the White House changes.
As we argued on this website on July 2, Big Tech companies have acquired quasi-sovereign powers. Their political and financial influence will not vanish with a change of leadership in Washington.
Raising the question of what comes after Turnberry may seem premature. It is not.
The EU must avoid repeating the mistake it made in 2024, when it staked everything on Joe Biden’s re-election, or Kamala Harris’s election, and was left entirely unprepared for the Trump cyclone.
Building a European consensus on issues of such strategic importance takes time. Anticipating the next confrontation and adopting a long-term perspective is the only prudent strategy available to the EU.
A previous version of this article was published by Il Sole 24 Ore
IEP Bocconi does not express opinions of its own. The opinions expressed in this publication are those of the authors. Any errors or omissions are the responsibility of the authors.
