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The European Union and the United States have the largest bilateral trade and investment relationship and enjoy the most integrated economic relationship in the world. Although overtaken by China in 2020 as the largest trading partner specifically for goods, when services and investment are taken into account, the US remains the EU’s largest trading partner by far.
The transatlantic relationship is a key artery of the world economy. Either the EU or the US is the largest trade and investment partner of almost every other country in the global economy. Taken together, the economies of both territories account for one third of global trade in goods and services and close to one third of world GDP in terms of purchasing power.
- Bilateral trade and investment support millions of jobs in the EU and the US. Around 9.4 million people are directly employed. Indirectly, as many as 16 million jobs on both sides of the Atlantic are supported.
- The EU-US trade and investment relationship remains strong despite the economic challenges related to the Covid-19 pandemic.
- Transatlantic trade reached an all-time high of 1.2 trillion euro in 2021, surpassing pre-pandemic levels by more than 10%.
- The United States remains the EU’s number one trading partner in services. Bilateral trade in services reached a record in 2021 and accounted for more than 500 billion euro.
- The size of trade in services and goods between the EU and the US is matched by their mutual investments, which are the biggest in the world and which are a substantial driver of the transatlantic relationship.
- Total US investment in the EU is four times higher than in the Asia-Pacific region. EU foreign direct investment in the US is around 10 times the amount of EU investment in India and China together.
- Total investment includes foreign direct investment, where the EU and the US are each other’s biggest sources. In 2020, the EU registered €2.1 trillion in outward stock, and €2.3 trillion in inward stock.
- The transatlantic relationship is a key feature of the overall global economy and trade flows. For most countries, either the EU or the US is the largest trade and investment partner.
The EU and the United States
After the 2021 EU-US summit, the European Union and the United States released a Joint Statement announcing a renewed transatlantic partnership for the post-pandemic era, including on trade. This agenda centres on global health challenges, green growth, strengthening trade relations, and fostering democratic values for a more secure world.
The EU-US Trade and Technology Council
The European Union and the United States launched the EU-US Trade and Technology Council (TTC) at their summit in Brussels on 15 June 2021. The TTC serves as a forum for the EU and the US to coordinate approaches to key global trade, economic and technology issues, and to deepen transatlantic trade and economic relations based on shared democratic values.
At the TTC’s inaugural meeting in Pittsburgh on 29 September 2021, the US and the EU published a Joint Statement agreeing to deepen transatlantic cooperation to strengthen semiconductor supply chains, curb non-market trade practices, and adopt a more unified approach to regulating global technology firms, with each party respecting the other’s regulatory autonomy.
The two sides agreed to exchange information on investment trends affecting security, including industry-specific trends, origin of investments, and types of transaction. They also agreed to share best practices on analysing and addressing risk, focusing on sensitive technologies and data.
Since its inauguration, EU-US discussions in the TTC have taken place at a steady pace, including at ministerial level in May 2022 in Paris-Saclay. These discussions take place in 10 working groups, which are in regular contact with stakeholders. Some groups focus on developing technology standards, advancing supply chain security, export controls, and investment screening. Other groups look at developing finance for secure and resilient digital connectivity in third-world countries, tackling arbitrary or unlawful surveillance, and promoting SMEs’ access to digital tools.
You can find more information on events related to the Trade and Technology Council and help shape the debate on the Commission’s dedicated Futurium website.
Despite the US being the EU’s largest trade and investment partner, there is no dedicated free trade agreement between the EU and the US. The Transatlantic Trade and Investment Partnership (TTIP) negotiations were launched in 2013, but ended without conclusion at the end of 2016. They were formally closed in 2019. Nevertheless, transatlantic trade continues to enjoy one of the lowest average tariffs (under 3%) in the world, governed by World Trade Organization (WTO) rules.
Trade disputes often grab headlines, but the current disputes only affect around 2% of EU-US trade. The WTO’s dispute settlement mechanism handles some of these disputes.
The EU-US Summit of 2021 made progress towards resolving some of the longest-standing trade disputes between the two parties. At the summit, both sides took a decisive step toward resolving the Airbus-Boeing WTO dispute, by creating a Cooperative Framework for Large Civil Aircraft and suspending related US and EU tariffs for five years.
In October 2021, the EU and US agreed to start discussions on a Global Sustainable Arrangement on Steel and Aluminium. In parallel, both sides suspended their respective tariff rebalancing measures, and agreed to pause the bilateral World Trade Organization disputes related to the section 232 steel and aluminium dispute. This marked an important milestone in the transatlantic relationship, and in EU-US efforts to achieve the decarbonisation of the global steel and aluminium industries in the fight against climate change.
Trading with the United States
- Importing into the EU from the United States
- EU trade defence measures on imports from United States
- Exporting from the EU to the United States
- Trade relations are part of the EU's overall political and economic relations with the United States
- United States is a member of the World Trade Organization
Today, the EU requested the establishment of a compliance panel to assess the measures taken by the US to comply with the World Trade Organization (WTO) Panel report which ruled against US tariffs on Spanish ripe olives.
Today, the European Commission has adopted its negotiating directives for a Critical Minerals Agreement (CMA) with the United States. The objective is to foster EU-US supply chains in critical raw materials needed in the production of electric vehicle batteries.
Second EU-US Ministerial Trade and Labour Dialogue meeting discusses forced labour and the green transition
On 31 May 2023, the EU and the US held their second tripartite Trade and Labour Dialogue (TALD) with EU and US social partner stakeholders. The discussion focused on how to eradicate forced labour from EU and US supply chains and how to make green transition a success for workers and businesses.