On July 28, analysts at the Veža Public Analytics Center discussed the signing of a significant trade agreement between the US and the European Union. The agreement, negotiated over several years, introduces a base tariff rate of 15% and outlines future prospects of duty-free trade between the parties. Additionally, the EU has committed to purchasing US energy resources totaling $750 billion and military equipment, with investment in the US economy expected to reach $600 billion.
The discussion highlighted that this achievement establishes new global trade rules. The agreement brings together the world's second and third largest trading powers after China, possibly affecting developing nations. It was noted that the US aims to diminish the influence of the World Trade Organization by fostering bilateral deals.
Energy was a key component, as the EU shifts away from Russian supplies and pivots to US cooperation. This move could reallocate the energy market to the advantage of the US and reduce Russia's influence. The EU also plans to invest in the US economy and purchase arms, part of which could be transferred to Ukraine.
The agreement's impact on China and India was also discussed. The US and EU may increase tariffs on goods from countries that continue to buy Russian energy, motivating a transfer of production from China to other regional states.
Experts stressed that China's economic growth relies on access to Western markets, and direct confrontation with the US and EU risks economic setbacks for Beijing. Overall, the agreement marks a new era of geopolitical competition, shifting the global balance of power.
