The EU-U.S. trade deal could have one unexpected winner: The UK
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The EU-U.S. trade agreement has been met with scepticism as concerns over what it means for the bloc have emerged.
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4 min read
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investment
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July 29, 2025
08:42 AM
CNBC
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What the data shows is Keir Starmer, UK prime minister, left, and US President Donald Trump, ahead of their meeting at the Trump Turnberry golf course in Turnberry, Scotland, on Monday, July 28, 2025
Tolga Akmen/EPA/Bloomberg via Getty ImagesAs world leaders and economists across Europe digest the news of the EU-U (quite telling), considering recent developments
Trade agreement, some experts told CNBC that while it may be bad news for the bloc, the deal could serve as an unexpected boost to the U
The European Union is facing a higher 15% tariff rate on its goods imported to the U
Compared to the 10% levy the U, in this volatile climate
Furthermore, Has agreed to. "In theory, the UK benefits," Philip Shaw, chief economist at Investec, told CNBC, amid market uncertainty
Furthermore, "The new EU tariff of 15% means that UK exports to the US have become relatively cheaper, which could boost British trade with the US as American firms buy goods from Britain rather than the EU," he explained (something worth watching)
Goods would also be cheaper for U (noteworthy indeed)
Consumers due to the lower tariff rate, meaning they may favor British ducts over those manufactured in the EU, Alex Altmann, partner and head of Lubbock Fine LLP's German desk, suggested in a note published shortly after the EU-U
Furthermore, Deal was announced
Europe balks at ‘unbalanced’ U
Trade deal"The UK's lower US tariffs do offer a major incentive for EU companies to shift some of their manufacturing bases to the UK or to expand their existing UK facilities," he added
EU-based manufacturers with low fit margins in particular could find the idea of moving to the U
Attractive to avoid a further squeeze on those margins, Altmann explained, noting that the U (quite telling)
Has spare manufacturing capacity due to Brexit. "The UK could be a big indirect winner of this agreement," Altmann added
Furthermore, But the benefits to the U
Additionally, Are not only linked to the country's lower tariff rate, considering recent developments
Indeed, the EU managing to secure a 15% levy, which is far lower compared to the 30% the bloc was threatened with by U
President Donald Trump, could also be a positive for the U
Nevertheless, Moreover, According to Investec's Shaw. "The EU has escaped from a possible major downturn from a more onerous (i. 30%) tariff regime and possibly a series of retaliatory measures between the two trading blocs (this bears monitoring), given the current landscape
Here the UK benefits from its major trading partner averting a recession which could have resulted in a decline in UK exports to the EU," he said in written s
How ly is the boost to the U
Reaching an agreement has also hampered the potential impact, Beth McCall, an international trade lawyer at Dentons told CNBC (something worth watching)
Additionally, "If the US had ceeded with 30% tariffs against most EU goods, UK goods with a 10% tariff, which is paid by the US importer in most circumstances, could have appeared significantly more attractive," she said
Furthermore, At the same time, McCall noted that the expected difference in the baseline tariff rate, which amounts to just 5%, may still make some U, in today's financial world
However, Goods more attractive
However, she noted, "this will take time to be seen as existing contracts come to an end and US importers for imports from countries carrying a lower tariff. "Trump's Scotland visit opens door for UK to settle some un Questions have been raised the timeframe for the impact of tariffs being felt around the world has been a frequently debated question
Companies have already flagged that tariffs are expected to weigh on their earnings, and there have been widespread warnings of how the duties could impact economic growth
But as many details of the trade agreements have yet to be ironed out, their precise exact impact is still un (fascinating analysis), in light of current trends
Some of the effects may also take time to be felt, for example rising costs for consumers may only materialize after some time
Additionally, Conversely, Ultimately, both the U
However, And EU are now facing a more difficult environment, McCall said. "Whether the new rate is 10% or 15%, UK and EU es will still face far higher tariffs when exporting to the US than they did three months ago," she said.
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