Back of the Napkin Deal

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Evodince GmbH
May 09, 2025

It’s been raining in Salzburg this week, as it has across much of Europe. Bloomberg Europe has been a constant backdrop in my living room, with talking heads in endless speculation about trade disputes, market volatility, and who’s going to blink first. Thankfully, it hasn’t driven me to drink—yet. But it did make me wonder how everyone else is handling the uncertainty. Apparently not well, as EU alcohol exports have surged to record highs.

Maybe that shouldn’t surprise us. As I stated in the April 8 edition, Brussels prepared a package of retaliatory tariffs aimed at the US—a signal that Europe is ready to fight fire with fire. Now the media is reporting those threats are finally—maybe—turning into action.

From the “Back of the Napkin” trade agreement between the US and UK yesterday—which was big in headline typefaces, small on specifics underneath—to Germany’s new Chancellor Friedrich Merz, balancing his commitment to transatlantic ties with the EU’s need for strategic autonomy (speaking of someone who needed a drink this week!), uncertainty is no longer a glitch. It’s the system.

Today we’ve curated news from Sweden, France, the United Kingdom, Greece, Belgium…even one from Down Under, looking at three key developments shaping the US/EU trade landscape: deals cut on rhetoric over regulation, European leaders balancing loyalty and leverage, and export sectors quietly finding profit in all the chaos.

Have a wonderful weekend, friends. Prost!

Leigh Fatzinger, Editor
Salzburg, Austria / 9 May 2025

From France

The US and UK have announced their first trade agreement under President Trump and Prime Minister Keir Starmer. Critics, however, argue the deal is more symbolic than substantial, with little in the way of legal structure—leading one trade lawyer to describe it as a “napkin deal.”

Tariffs slashed for UK as Trump and Starmer agree historic trade deal - The Independent UK (United Kingdom) - May 8, 2025

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The new list includes thousands of products. Among them are foodstuffs such as soybeans, meat, and bourbon, as well as industrial products, including sewing machines, aircraft parts, and cars. Benjamin Dousa hopes they will settle on measures targeting products that are replaceable, citing American jeans and Californian orange juice as examples.

"We are careful not to shoot ourselves in the foot. The countermeasures are meant to put pressure on the US to negotiate with us—not to harm Swedish and European economies." [Translated from Swedish by DeepL.]

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Your Weekend Thought Starters

📌 What’s Your “Napkin Deal” Story: The US-UK trade agreement offers press release optimism, but some analysts say it lacks enforceable structure. For businesses, it’s a reminder that clarity matters more than symbolism.

📌 Germany’s Dual Approach to the US: Chancellor Merz is trying to balance strong US ties with European strategic autonomy. Investors are reacting with optimism, but the long game is unclear.

📌 The EU is Ready to Push Back: With a proposed €95 billion in countermeasures, the European Commission is signaling it won’t sit idle if US tariffs escalate.

📖 Read Tuesday's edition of Evodince: EU Trade – Evodince Media (Austria) – 6 May 2025

European liquor exports surged to a record €29.8 billion in 2024, with analysts pointing to strong demand both within the EU and abroad. The uncertainty of U.S. trade policies may be driving global buyers to stock up on European brands.

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