EU ready to do a deal with US over car imports
Bid to stave off trade war with Washington
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The US has withdrawn from the Iran nuclear deal, posing a threat to European companies doing business in the country, and has blocked appointments to the World Trade Organisation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 possible, 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.
US President Donald Trump has imposed import duties of 25 percent on steel and 10 percent on aluminium on grounds of national security.