September 02, 2025
What the U.S.-EU $40 Billion Chip Deal Means
In the Framework on an Agreement on Reciprocal, Fair, and Balanced Trade, a section centers on two key issues: a European pledge to buy U.S. AI chips and a commitment to align on security safeguards.
At first glance, this looks like a breakthrough: a transatlantic alignment on AI chips, the foundational technology for models, systems, and agents. It projects the image of cooperation in a landscape otherwise marked by friction. But a closer look reveals that both the purchase numbers and the security commitments are provisional, leaving open key questions about scale, timing, and certainty.
The U.S.-EU framework exemplifies a recurring challenge in modern trade diplomacy: the tension between political symbolism and operational substance.
Viewed this way, the framework reflects a broad pattern in U.S. trade and technology diplomacy: headline figures first, implementation later.
For Europe, it falls short in two ways: it fails to establish a binding mechanism to fund or allocate $40 billion in chip purchases, and it fails to guarantee supply. For the U.S., it offers the optics of a significant commitment with limited substance. A final agreement is intended and may settle some of these issues (though the timing and substance of a final deal may be complicated by President Donald Trump’s threat this week of export restrictions on U.S. AI chips to Europe).
Read the full article on CEPA.
More from CNAS
-
Sanctions by the Numbers: 2025 Year in Review
Reports
This installment of Sanctions by the Numbers examines the United States’ use of financial sanctions and entity-based export controls...
By Eleanor Hume & Kyle Rutter
-
Commentary
Technology & National Security
The Rise of the Answer MachinesThis article was originally published in Financial Times. Every spring, I take red-eyes from Austin, Texas, to Oxford, England, to teach a graduate seminar on AI and philosoph...
By Brendan McCord
-
Video
Technology & National Security
Selling H200s to China Erodes Main U.S. AdvantageA new report says China could buy twice as much AI computing power as it can produce domestically if Nvidia H200 chips are allowed there. Janet Egan from the Center for a New ...
By Janet Egan
-
Trump's Davos Speech
Video
Edward Fishman, CNAS adjunct senior fellow, joined the Canadian Broadcasting Corporation to discuss the Davos forum, and President Trump's claims that only the U.S. can protec...
By Edward Fishman
