The European Parliament has paused work on the US-EU trade deal after fresh tensions with Washington. Lawmakers protested President Donald Trump’s remarks about Greenland and his tariff threats against European allies. France announced the move as Trump spoke at the World Economic Forum in Davos. Markets reacted with caution and investors feared another transatlantic trade clash.
Trump later said he reached a framework understanding on Greenland. He also withdrew plans to impose tariffs of up to 25 percent on eight NATO countries. Despite this shift, lawmakers kept the freeze. The pause blocks lower EU import duties on US goods. It also halts the extension of zero tariffs on American lobster exports.
The decision raises risks for US exporters. Planned duty cuts on farm and manufactured goods will not begin. Europe remains the largest US trading partner. Brussels has warned about retaliatory tariffs on up to 93 billion euros of US products. Such measures could lift costs and strain supply chains.
The July 2025 framework aimed to calm trade disputes. It proposed tariff caps near 15 percent on many EU exports. It also offered near-zero tariffs for aircraft, chemicals, and semiconductors. The EU pledged energy purchases and new investments in the United States. French President Emmanuel Macron has signaled possible use of the EU anti-coercion tool.
