EU Expects U.S. Metal Tariffs to Continue Into 2019
(Bloomberg) -- The European Union sees little chance of relief from controversial U.S. metal tariffs before mid-2019 while aiming for a narrow trans-Atlantic trade deal to avert any extra American automotive duties, according to one of the bloc’s officials.
The European Commission’s current talks with the U.S. to reduce trans-Atlantic market barriers for industrial goods should keep at bay President Donald Trump’s threat to impose levies as high as 25 percent on imported autos and vehicle parts, the official said on the condition of anonymity.
The commission, the EU’s executive arm in Brussels, is looking for an agreement with the Trump administration on a handful of trade-boosting measures such as in the area of industrial standards, the person said. This strategy is more modest than earlier proposals, including for free-trade accords and industry-specific deals.
A limited package of this kind -- rather than the much broader planned Trans-Atlantic Trade and Investment Partnership that Trump nixed after taking office -- can be pursued in the coming weeks and months without the need for EU governments to grant the commission a negotiating mandate, according to the official. A mandate is a standard part of the traditional European approach to trade talks that’s less appropriate when dealing with Trump, the person said.
The comments offer an insight into the EU’s trans-Atlantic trade strategy after commission President Jean-Claude Juncker and Trump struck a July 25 deal that put on hold the threat of an additional U.S. duty on European cars -- the regular American levy is 2.5 percent -- and that left the bloc breathing a sigh of relief. The value of EU automotive exports to the U.S. is about 10 times greater than that of the bloc’s steel and aluminum exports combined.
The accord a month and a half ago held out the prospect of an eventual settlement to the dispute over the U.S. metal levies, which prompted the EU to retaliate with tit-for-tat duties on American goods. A joint statement at the time said: “We also want to resolve the steel and aluminum tariff issues and retaliatory tariffs.”
Juncker and Trump decided during their July meeting in Washington to establish a working group, which had its political kickoff on Sept. 10 when the European and U.S. trade chiefs held talks in Brussels. The sides will have another meeting in November to “finalize outcomes.”
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