Germany's Merz hails EU deal on US pact

German Chancellor Friedrich Merz said an agreement struck Wednesday to implement the European Union's nearly year-old trade pact with the United States showed the bloc was "delivering on its commitments". In a post on X, the leader of Europe's biggest economy said the deal meant "more security and stability for our businesses", after US President Donald Trump threatened new tariffs over delays in implementing the trade pact.

The 27-nation bloc struck an accord with Washington last July setting levies on most European goods at 15 percent, but to Trump's frustration it had yet to make good on its pledge to scrap levies on most US imports in return. After lengthy talks, negotiators from the EU's parliament and capitals reached a deal to move forward early Wednesday. While broadly welcoming the deal, Germany's auto industry association VDA warned that "newly added safeguard clauses must not lead to the US side terminating the agreement".

"Both sides are therefore now called upon to reliably finalise the negotiations as quickly as possible," the group's president Hildegard Mueller said in a statement. "This also includes a withdrawal of the recent tariff threats by US President Trump," she said. Trump had threatened to raise duties on European cars and trucks from 15 to 25 percent.

The final text empowers the European Commission to trigger a suspension mechanism if Washington fails to meet its commitments or disrupts trade and investment with the EU, and also gives the bloc means to address spikes in US imports that are deemed a threat to domestic producers.