Over the weekend, the European Union and the United States agreed the basis for a trade deal at President Trump’s golf course in South Ayrshire, Scotland. Trump dubbed it “the largest trade deal in history”.

This is a fast-moving situation, but here is what we know so far, and what the key players have said.

Before the meeting on Sunday, the EU was set to face 30% US tariffs “on most EU goods” from 1st August. 

Afterwards, European Commission President Ursula von der Leyen released a statement, saying:

“Today's deal creates certainty in uncertain times.

“We have stabilised on a single 15% tariff rate for the vast majority of EU exports (into the US). This rate applies across most sectors, including cars, semiconductors and pharmaceuticals.

“Today we have also agreed on zero-for-zero tariffs on a number of strategic products. This includes all aircraft and component parts, certain chemicals, certain generics, semiconductor equipment, certain agricultural products, natural resources and critical raw materials. 

“And we will keep working to add more products to this list.

“On steel and aluminium… We will work together to ensure fair global competition. And to reduce barriers between us, tariffs will be cut. And a quota system will be put in place.

“We will also increase our energy cooperation… We will replace Russian gas and oil with significant purchases of US LNG, oil and nuclear fuels.

“US AI chips will help power our AI gigafactories and help the US to maintain their technological edge.

On the deal, President Trump said:

“We have reached a deal. It's a good deal for everybody.

"It's going to bring us closer together" (BBC News).

The new US 15% tariff that US buyers will pay on EU products is the same as on Japanese goods, whilst the UK faces a 10% tariff on most products.

As it stands, from 1st August the UK will face tariffs including:

• 25% on steel, aluminium and automobiles
• 10% on auto parts (which came into effect in May)
• Up to 50% on copper (Wise).

There is no getting away from the fact that President Trump’s move has been a success in US domestic political terms. Imposing selective tariff barriers to ‘protect’ key industries has long been a desire of the America First movement and Trump has done this while avoiding the catastrophic damage to the US and global economies that a 30% tariff would have caused.

Neither has he faced significant retaliation from trading partners, except China. This will skew the terms of global trade in the US’ favour.

But that does not mean there will be net benefits to the US economy - these are additional trade barriers that will damage all sides.

Furthermore, any claims made in the UK that these tariff outcomes somehow justify the UK leaving the EU are incorrect.

In 2021, the UK Trade Policy Observatory estimated that £2.5–3.5 billion worth of UK exports were hit by EU tariffs in the first year after Brexit. Now, about 10% of UK exports to the EU face tariffs for varying reasons.

Much remains unclear about the final details of both the UK and EU deals with the US. But one thing is certain. If being hit slightly less hard than the EU by US tariffs represents any marginal gain for the UK, it will be a tiny fraction of the massive cost of being outside the EU single market - which is between 3% and 5% of GDP every year.

Expect more developments on this story.