EU ready to do a deal with US over car im­ports

Bid to stave off trade war with Washington

The Star Late Edition - - BUSINESS REPORT - Reuters

THE EU IS ready to ne­go­ti­ate open­ing its mar­kets wider to US im­ports, in­clud­ing cars, in a bid to stave off a po­ten­tial trade war with Washington, EU lead­ers said yes­ter­day.

US Pres­i­dent Don­ald Trump has im­posed im­port du­ties of 25 per­cent on steel and 10 per­cent on alu­minium on grounds of na­tional se­cu­rity, but has granted EU pro­duc­ers a tem­po­rary ex­emp­tion un­til June 1 pend­ing the out­come of mu­tual talks.

EU lead­ers meet­ing at a sum­mit in Sofia sought to find a com­mon stance, bal­anc­ing the in­ter­ests of those, such as Ger­many, who are most keen to avoid a trade con­flict and those, in­clud­ing France, most de­ter­mined not to be bul­lied into con­ces­sions.

“We have a com­mon position. We want a per­ma­nent ex­emp­tion and then we are ready to talk about how we can re­cip­ro­cally re­duce the bar­ri­ers to trade,” Ger­many’s An­gela Merkel said yes­ter­day.

EU diplo­mats say the need to find a uni­fied stance that goes be­yond just tar­iffs.

The US has with­drawn from the Iran nu­clear deal, pos­ing a threat to European com­pa­nies do­ing busi­ness in the coun­try, and has blocked ap­point­ments to the World Trade Or­gan­i­sa­tion (WTO), thereby un­der­min­ing its abil­ity to set­tle trade dis­putes.

EU lead­ers agreed on four ar­eas for which the bloc would be will­ing to open talks with the US, but only on con­di­tion that Washington grant EU steel and alu­minium mak­ers a per­ma­nent ex­emp­tion from tar­iffs.

“We seek solutions. It is pos- sible, there is room. The agree­ment yes­ter­day on four points gives some kind of space for talks,” Lithua­nian Pres­i­dent Dalia Gry­bauskaite said.

The ar­eas iden­ti­fied for co-oper­a­tion are mar­ket ac­cess for in­dus­trial prod­ucts, in­clud­ing cars, and govern­ment ten­ders, en­ergy – no­tably liq­ue­fied nat­u­ral gas, pos­si­ble co-oper­a­tion on reg­u­la­tions, and re­form of the WTO.

“These talks will be based on the prin­ci­ples of rec­i­proc­ity and WTO com­pat­i­bil­ity and with the ob­jec­tive of avoid­ing a trade war,” an EU of­fi­cial said.

Trade min­is­ters are ex­pected to dis­cuss the is­sue at a meet­ing in Brus­sels next Tues­day.

The European Com­mis­sion, which over­sees trade pol­icy for the 28 EU mem­bers, has said it would re­spond to tar­iffs with its own du­ties on US prod­ucts, in­clud­ing mo­tor­cy­cles and whisky.

To keep this pos­si­bil­ity open, it pub­lished a draft law yes­ter­day to al­low it to im­pose 25 per­cent tar­iffs on a range of US im­ports from June 20 and tar­iffs of up to 50 per­cent on im­ports from March 23, 2021.

It will no­tify the World Trade Or­gan­i­sa­tion of its po­ten­tial plans by to­day. Vir­tual re­al­ity

US Pres­i­dent Don­ald Trump has im­posed im­port du­ties of 25 per­cent on steel and 10 per­cent on alu­minium on grounds of na­tional se­cu­rity.

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