The European Union and Mexico revived a stalled free trade agreement on Friday, days before the return to the White House of Donald Trump, who has threatened both sides with tariffs.

Mexico and the European Union are announcing a revamped agreement that they said would boost trade and investment, amid Trump's tariff threats.

Trump, who will be inaugurated next week, has threatened the EU with tariffs and his team has criticized the bloc for being weak on China. The manner in which the EU handles the dispute will present an early test of how the world approaches trade under the new administration in Washington and the resilience of the transatlantic relationship.

The European Union and Mexico agreed to a revamped free-trade agreement, just as both are under pressure from President-elect Donald Trump, who has threatened them with new tariffs.

The European Union and Mexico secured a fresh trade deal before President-elect Donald Trump—who has threatened both regions with steep tariffs on exports—takes office.