EU summit ends without US trade deal decision as Ukraine’s plight and global challenges dominate

European Union leaders wrapped up a marathon summit in Brussels late Thursday night, grappling with a new U.S. trade proposal but failing to reach a consensus as the 9 July deadline looms for President Donald Trump’s threatened tariff hikes.

European Commission President Ursula von der Leyen emphasized the EU’s readiness for a deal while keeping “all options on the table,” including retaliatory tariffs on up to €95 billion of U.S. goods.

The summit, pivoting from a NATO meeting that endorsed a costly 5% GDP defence spending target, also tackled Ukraine’s worsening battlefield losses, Russian gas phase-outs, and Middle East tensions, exposing deep divisions and Europe’s struggle to assert unity against a backdrop of U.S. dominance and global uncertainty.

EU debt levels, exceeding 80% of GDP, make von der Leyen’s €800 billion defence plan – proposing €150 billion in joint borrowing – contentious, as fiscally cautious states hesitate.

Trade talks with the U.S.: a race against time

With Trump’s 20% tariffs on EU goods – plus 50% on steel and aluminium and 25% on cars – set to escalate if no deal is reached by 9 July, the summit saw heated debate over whether to pursue a “quick and simple” trade agreement, as urged by German Chancellor Friedrich Merz, or hold out for a balanced deal, as demanded by French President Emmanuel Macron.

Merz, under pressure from Germany’s carmakers facing a projected 0.3% GDP loss, warned that a complex deal was unfeasible in the tight timeframe, stating, “We have less than two weeks.”

Macron, however, insisted on fairness, declaring, “Our goodwill should not be seen as a weakness,” and floated targeting U.S. services, such as a digital advertising tax impacting tech giants like Google and Meta.

Von der Leyen, who received a U.S. negotiating document described as a “two-pager, principle agreement” on Thursday, said the EU was still assessing it.

“We are ready for a deal, but we are preparing for the possibility that no satisfactory agreement is reached,” she told reporters, signalling potential countermeasures like the suspended €21 billion tariff package on U.S. goods.

An EU diplomat noted the U.S. reluctance to dive into sector-specific talks, complicating negotiations.

The EU’s earlier offer of a “zero-for-zero” tariff deal on industrial goods, rejected by Trump in April, remains on the table, reflecting Brussels’ push for de-escalation amid fears of a broader trade war affecting Asia-Pacific partners.

Von der Leyen proposed a bold trade initiative, suggesting the EU’s 27 nations join the 12-member Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) to reform the “defunct” World Trade Organization, pointedly noting the U.S. would not automatically be invited.

“This would show free trade is possible on a rules-based foundation,” she said, aiming to counter Trump’s protectionism with a new global trade bloc.

Merz said the idea was in its early stages but could include mechanisms to resolve disputes, as the WTO was meant to do.

“You all know that the WTO doesn’t work any more,” he said.

France and Germany disagree on Mercosur

Tensions between Macron and Merz over the Mercosur trade deal with South American nations resurfaced, highlighting their divergent priorities.

Merz, backed by Germany’s export-driven industries, pushed for swift ratification of the agreement, finalized in December 2024, arguing it would boost EU competitiveness against U.S. and Chinese markets, stating, “We are basically united on concluding Mercosur.”

Macron, however, reiterated France’s opposition, citing threats to French farmers from cheap agricultural imports, particularly beef, and environmental concerns over Amazon deforestation. “I cannot support the deal in its current form,” he declared, insisting on stricter safeguards.

Ukraine’s battlefield woes and EU support

As expected, Hungary’s Viktor Orbán remained firmly opposed to Ukraine opening accession negotiations. Conversely, there is green light for Moldova, with a summit to be held on 4 July.

Ukrainian President Volodymyr Zelenskyy, addressing the summit online, urged a clear signal on EU membership and a new sanctions package targeting Russia’s oil trade and banks, warning that delays could weaken Europe’s credibility globally.

“Putin’s dream is a fragmented Europe,” he said, pointing to Russian support for divisive voices within the EU. Recent reports highlight Ukraine’s difficult situation, with Russian forces advancing up to 20 km daily in Donetsk and Sumy, breaching defensive lines and exposing shortages of troops and ammunition. A Kyiv hotel strike on 19 June, killing four, underscored the war’s toll.

EU Council President António Costa praised Ukraine’s “impressive” reforms, advocating intensified work toward accession.

Slovakia’s Robert Fico blocked a vote on the 18th sanctions package, citing concerns over the EU’s 2027 Russian gas phase-out. This veto, tied to Slovakia’s reliance on Russian gas, forced the issue to foreign ministers for further deliberation.

Middle East tensions and EU contradictions

The summit also addressed Middle East developments, condemning the “catastrophic” humanitarian crisis in Gaza and discussing Iran’s nuclear program post-U.S. strikes.

Macron condemned Israel’s actions in Gaza as “disproportionate,” advocating for an immediate ceasefire and increased humanitarian aid, reflecting Paris’s sensitivity to its Muslim population and historical ties to Arab nations.

In contrast, Merz emphasized Israel’s right to self-defense, urging caution against alienating a key ally while supporting limited aid to Gaza, aligning with Berlin’s post-Holocaust commitment to Israel.

Orbán and Fico resisted strong criticism of Israel, with The Hungarian PM echoing Trump’s pro-Israel stance and prioritizing bilateral ties over humanitarian concerns.

Meanwhile, Ireland and Spain pushed for suspending the EU-Israel trade agreement, citing violations of human rights clauses amid Gaza’s “catastrophic” conditions, as noted in a joint EU statement. These divisions, rooted in historical, political, and domestic pressures, stalled a cohesive EU policy, with leaders settling for a vague call for de-escalation and aid access.

With Reuters, European Pravda, edited by g.g.

Caption: Backstage photo showing EU leaders speaking to the media upon arrival in the Council, on 26 June 2025. [Council newsroom]

Updated: June 27, 2025 - 05:05