EU countries warned Thursday that they would reject any trade deal with President Donald Trump that mirrors the U.S. agreement with the U.K., firmly opposing a baseline 10 percent tariff as a starting point for negotiations.
“If the U.K.-U.S. deal is what the EU gets, the U.S. can expect countermeasures from us,” Swedish Trade Minister Benjamin Dousa said on his way into a meeting of EU trade ministers in Brussels.
“I don’t think we can expect any kind of deal between the EU and the U.S. in the coming weeks, unfortunately,” he added.
Washington last week struck a pact with the U.K. to reduce tariffs on U.K. auto and steel exports, but fell short of removing the 10 percent universal tariff that Trump imposed on April 2, “Liberation Day.” A couple of days later, China nailed its own breakthrough, with Washington and Beijing slashing their tariffs to 30 percent and 10 percent, respectively, on each other’s goods.
While the EU has yet to hammer out its own agreement, fueling fears in Brussels that the bloc is at the bottom of Trump’s priority list, the European Commission’s chief trade negotiator Maroš Šefčovič confirmed he had a “constructive” call on Wednesday with U.S. Commerce Secretary Howard Lutnick.
We “agreed to intensify our engagement at technical levels,” Šefčovič told reporters, adding he would meet with U.S. Trade Representative Jamieson Greer “very soon.”
Although the Commission leads trade negotiations for the bloc, Brussels is working to keep member countries aligned to avoid a fragmented approach in talks with the White House.
Putting it in writing
Thursday’s ministerial meeting comes after the U.S. sent a letter, first reported by POLITICO, laying out general principles it would expect from the EU — in a first sign it is willing to engage in a negotiated deal with the bloc in their trade war.
Washington and Brussels want to team up on tackling overcapacity in the steel sector, reduce their dependencies on critical minerals, and further cooperate on sensitive technologies such as AI, Maroš Šefčovič told reporters.
Aside from tackling the glut of steel on their markets, Washington and Brussels should also further cooperate on sensitive technologies, such as artificial intelligence and chips production.
“There are areas where we are absolutely convinced that we can achieve much better results if we would address them jointly as allies,” the EU trade chief said.
Michał Baranowski, Poland’s economic development minister, said it was “a very good sign” that the U.S. had decided to de-escalate, referring to the deals of the Trump administration with the U.K. and China.
Baranowski, who chaired Thursday’s meeting, stressed the EU should not feel pressure for a U.S. deal of its own. The main lesson from the U.K. and China deals, he said, would be “don’t jump too fast: We don’t need a quick deal, we need a good deal.”
The Commission also was critical of the British-American deal Thursday.
“It’s not a full deal — it’s more of a political agreement to start negotiations,” the Commission’s head for U.S. trade relations Matthias Jørgensen told the European Parliament, who added the texts seem to “imply some political concessions by the U.K.” on beef and cars.
If Brussels and Washington fail to reach a deal by early July, a higher tariff of 20 percent would kick in. On top of the 10 percent tariff, Washington still imposes a 25 percent levy on cars as well as steel and aluminum.
“We’re not interested in this kind of agreement; what we want are meaningful discussions with the U.S. administration to set up a real trade partnership,” an EU diplomat said, summing up the mood among ministers. “Of course, that takes more time and seriousness than posting a piece of paper that has virtually no impact.”
Those red lines were shared by French Trade Minister Laurent Saint-Martin, who said that the status quo wasn’t “tolerable.”
“We have to be wary about the fact that keeping a 10 percent reciprocal tariff would be good news,” he said.
In keeping its usual contrarian stance, Hungary was one of the only countries that opened the door to keeping the baseline tariff.
“I think that would be a fair solution,” said Levente Magyar, a deputy minister at Hungary’s foreign and trade ministry.
Via Politico
