The European Union is seemingly poised to accept a trade agreement with the United States that imposes a 15 percent tariff on all European export goods. This outcome is considered “very unsatisfactory” and reflects the EU’s inability to stand firm in negotiations with the US.

The agreement includes a reduction of tariffs on cars and medicine from 25 to 15 percent. However, Washington is expected to maintain a 50 percent tariff on steel and aluminum.

The European Commission stated that the focus is on achieving a negotiated solution to avoid a 30 percent tariff wall envisioned by the US if the August 1 deadline is exceeded. The current agreement is viewed as the best alternative.

The EU has approved counter-tariffs on American goods worth 93 billion euros, but these will only take effect if the trade agreement with the US fails.

The EU possesses a significant economic tool known as the “trade bazooka” or anti-coercion instrument. This can be used if the EU can prove that the purpose of a tariff attack is to pressure Europe into making specific political changes.

This instrument would allow the EU to broadly target American interests. However, its activation requires documented economic coercion and a qualified majority vote among the 27 member states, a process that could take months. This lengthy process highlights the limitations of the EU’s leverage in trade disputes.