The Future of EU Trade: Charting a Course Through Uncertainty

As the global trade landscape grows increasingly complex, European policymakers and business leaders are grappling with the dual challenges of geopolitical instability and shifting transatlantic relations.

At a recent panel discussion, Group members discussed with experts the future of EU trade policy, with a particular focus on the transatlantic trade relations ahead of the looming July 9 deadline for resolving EU-US tariff disputes.

Opening the session, Group member Antje Gerstein underscored the importance of legal certainty for businesses, warning that the current environment is marked by unprecedented uncertainty. Despite these headwinds, she noted that investment levels in Germany remain historically high, a testament to the underlying strength of the European economy even as businesses navigate a volatile global context.

Treading a Narrow Path with the US, diversification and reform

Thibaut L'Ortye, Senior Director of Public Affairs at AmCham, highlighted the negative impact of ongoing tariff threats on prices, supply chains, and business confidence. With the EU and US facing a critical July 9 deadline to resolve tariff disputes as US President Trump has threatened to impose 50% tariffs on all EU imports if negotiations fail.-L'Ortye expressed cautious optimism that a solution could be found, but warned of the consequences if talks fail.

Despite political friction, L'Ortye emphasized that the core issues in the EU-US trade relationship have remained largely unchanged over time. He urged continued constructive engagement, noting that businesses are aware of the differences between political rhetoric and actual policy changes. The strength of investment ties across the Atlantic, he argued, shows that a deal has to be made as too much is at stake.

Sofia Muñoz Albarran, Director for Interinstitutional Relations at DG TRADE, outlined the EU’s multi-pronged strategy for navigating current challenges. She described ongoing efforts to engage, negotiate, and rebalance—particularly regarding the suspended steel and aluminium measures, which are on hold until July 14.

Beyond the US, the EU is actively pursuing trade diversification, with negotiations underway with Mercosur, Mexico, India, Indonesia, ASEAN countries, and Saudi Arabia. Muñoz Albarran stressed that the goal is to secure commercially viable agreements, not just any deal for the sake of headlines.

To monitor the impact of trade diversions and sectoral shifts, the EU has launched new surveillance systems and public consultations. On the global stage, the EU continues to champion World Trade Organization (WTO) reform, despite the institution’s ongoing crisis. The next WTO Ministerial Conference (MC14), to be held in Yaoundé, Cameroon, in March 2026, is seen as a key moment for advancing the EU’s rules-based trade agenda.

Environmental and sustainability concerns, such as deforestation, are now integral to the EU’s trade negotiations, particularly with partners like Mercosur, India, and Indonesia. This approach reflects the bloc’s commitment to aligning trade policy with its broader Green Deal objectives. Some stakeholders cautioned that the EU may be stretching its regulatory reach too far in its environmental objectives.

Business Impact: SMEs, Regulatory Burdens, and the Need for Speed

Dominic Boucsein, Head of International Trade at Eurochambres, brought the perspective of European businesses to the fore. He identified geopolitical tensions as the top concern, particularly for small and medium-sized enterprises (SMEs) that are more vulnerable to uncertainty and rapid regulatory changes. Boucsein noted a trend of investments originally intended for the US being redirected to alternative markets, such as Morocco.

He called for a renewed focus on competitiveness, innovation, and the swift conclusion of commercially meaningful trade agreements. “Negotiations like Mercosur cannot drag on for decades,” Boucsein insisted, pointing out that 87% of global trade occurs outside the US and should not be neglected. He also advocated for better utilization of existing trade agreements, increased awareness among businesses, and stronger cooperation between the European Commission, chambers of commerce, and national governments.

Indeed, many EU businesses are not taking full advantage of existing trade agreements, often due to lack of awareness or administrative hurdles.

New Trade Conflicts?

Many underscored the risk of a US ‘Revenge Tax’: New US legislation could impose retaliatory tariffs of up to 20% on countries with “unfair” tax regimes, raising the stakes for EU exporters. With historically low average tariffs (1.4%) between the EU and US, even modest increases could have significant negative effects, impacting not just trade but also global standards and security.

Questions were raised about the EU’s capacity to lead on global trade, especially in light of China’s overproduction and sector-specific impacts. BRICS countries have criticized EU mechanisms like the Carbon Border Adjustment Mechanism (CBAM), and trade conflicts linked to sustainability measures are on the rise.

Other stakeholders underlined the vulnerability of the steel industry facing the threat of 50% tariffs and continued dependence on Russian gas, despite diversification efforts.

In their closing remarks, panelists emphasized the need for urgency, unity, and readiness.

Thibaut L'Ortye reiterated that, regardless of the outcome on July 9, businesses will continue to pursue opportunities on both sides of the Atlantic. The transatlantic relationship, he stressed, remains invaluable.

Sofia Muñoz Albarran warned that the US has not always been a reliable partner in recent years and that a 50% tariff would be disastrous for both economies. She called for urgent progress on trade agreements.

Dominic Boucsein emphasized the importance of ongoing dialogue with US policymakers and national governments. Should tariffs come into force, he argued, contingency support for affected businesses will be essential, and the EU must remain united and pragmatic in its response.

As the July 9 deadline approaches, the future of EU trade—and the stability of the global trading system—hangs in the balance. The discussions in Brussels made clear that while the path forward is fraught with challenges, there is a shared determination among policymakers and business leaders to safeguard Europe’s economic interests, promote sustainable trade, and maintain strong transatlantic ties. The coming weeks will test the EU’s ability to navigate uncertainty with agility, resilience, and a clear sense of purpose.