Juncker heads to US for trade talks
• European Commission head in bid to ward off tariffs on car exports
European Commission head Jean-Claude Juncker heads to Washington on Wednesday in a last-ditch effort by the EU to cool nerves and find an exit door from an all-out trade war with US President Donald Trump.
Juncker, a grizzled veteran of EU politics, follows a long list of European leaders including German Chancellor Angela Merkel, who have tried to lure Trump away from a protectionist onslaught that has spooked financial markets and the world.
The former Luxembourg prime minister is going to Washington without a negotiating mandate, but with the intention of thinking “outside the box” to “find a solution” with Trump, said EU trade commissioner Cecilia Malmstrom, who will join Juncker on the trip.
Juncker leaves for Washington on Tuesday and his meeting with Trump is scheduled for 1.30pm (7.30pm SA time) on Wednesday, to be followed by a speech on EU-US ties.
“It is an opportunity to dedramatise any potential tensions on trade and to engage into an open, constructive dialogue with our American partners,” Juncker’s chief spokesman, Margaritis Schinas, said.
At stake is a White House threat to slap a daunting wave of tariffs on European car exports to the US, an action the Europeans say would trigger a global economic earthquake and earn a withering riposte from Brussels. If confirmed, Trump’s car tariffs would add to the steel and aluminium tariffs imposed in June that seriously damaged transatlantic relations.
In response, the EU imposed a raft of retaliatory tariffs on June 22 that targeted the most emblematic of US exports, from blue jeans to Harley-Davidson motorbikes and whiskey. Fearing car tariffs, Brussels is drawing up a list of more US products that could be hit with retaliatory duties if Juncker’s trip fails.
“We will continue to respond toe-to-toe to provocations,” Juncker warned in a speech on Wednesday. “All efforts to divide Europeans are in vain,” he said.
Juncker’s commission han- dles trade matters for the EU 28 and he goes to the White House with the firm backing of Merkel, the leader of export powerhouse Germany, which Trump has angrily singled out for punishing the US on trade.
Merkel expressed hope on Friday that Juncker could negotiate a solution with Trump and stop the trade war.
Describing the trade tensions as “very serious”, Merkel has warned that tit-for-tat feuding between the allies would be “by far the worst possible solution”.
The potential car tariffs would not just violate the rules of the World Trade Organisation, she added, but could also “endanger the prosperity of many people around the world”.
But the prospects for trade peace seemed slim at Group of 20 talks on Saturday after US Treasury secretary Steven Mnuchin said Washington would demand a wide-ranging trade deal with Europe in order to stand back on its tariff threat.
“If Europe believes in free trade, we’re ready to sign a free trade agreement with no tariffs, no non-tariff barriers and no subsidies. It has to be all three,” Mnuchin said.
But French Finance Minister Bruno Le Maire shot back firmly: “We refuse to negotiate with a gun to the head,” insisting that Trump must first withdraw the steel and aluminium tariffs and stand down on his threat about car tariffs.
Not to be daunted by Trump’s protectionism, Juncker toured Asia last week, signing the EU’s biggest-yet trade deal with Japan while also backing multilateralism alongside the Chinese government during a stopover in Beijing.
The EU, the world’s biggest single market with 28 countries and 500-million people, has also secured similar trade deals with US neighbours Canada and Mexico. /