By Philip Blenkinsop; Editing by Joe Bavier.
BRUSSELS, July 15 (Reuters)
Tensions between the United States and countries with which it trades have grown in recent days, generating global concern, particularly in the economic sector, as this directly impacts large companies. The current concern is the relationship between the country and the European Union. Following the increase in US tariffs on EU countries, a deterioration in international relations is expected. What can we expect from the negotiations? The deadlines imposed by Washington are getting closer. Learn more about these global scenarios.
Conflict between the USA and the EU increases
Aircraft, machinery, cars, chemicals, and medical devices are the leading big-ticket items on the latest list of U.S. goods the European Commission has proposed to impose tariffs on if talks with Washington do not yield a trade agreement.
The package is the second put forward by the European Commission, which oversees trade policy for the 27-nation European Union. It is designed to respond to U.S. tariffs on cars and car parts and a baseline tariff, currently at 10%.
U.S. President Donald Trump, however, is now threatening a baseline tariff on imports from the EU of 30% from August 1, a level European officials say is unacceptable and would end normal trade between two of the world’s largest markets.
Understand which goods are targeted for retaliation by the EU
The EU is poised to target the most strategic sectors of the American economy, due to the range of products included in the new tariff proposal adopted by the US, which has reached alarming levels for international relations. We could see a significant impact, especially in the automotive, agricultural, and food sectors. This is a way to pressure the US to back down on the tariffs.
The list, sent to EU member states and seen by Reuters on Tuesday, covers U.S. goods imports worth 72 billion euros ($84.1 billion). It also includes electrical and precision equipment as well as agriculture and food products – a range of fruits and vegetables, along with wine, beer, and spirits – worth a total of 6.35 billion euros. A first package on 21 billion euros of U.S. goods was approved in April but then immediately suspended to allow room for negotiations. That suspension has been extended to August 6.
EU officials said on Monday that they were still seeking to strike a deal to avoid Trump’s heavy tariff blow, but EU trade chief Maros Sefcovic said member states had agreed the bloc would need to take countermeasures if talks with the U.S. fail. The Commission initially put forward the second package in May for a public consultation. The proposal then related to 95 billion euros of U.S. goods. It has since been whittled down, though most of the main items have remained. There is no specific date for EU members to approve the package.
The EU is still trying to adopt a more diplomatic approach to resolving its conflicts with the US. However, the US’s more rigid stance has not yet opened up space for dialogue and concessions on tax easing. This has led the bloc to consider taking action against the country, as this gives them political permission after the lack of conclusive negotiations.
What can we expect from the negotiations?
The geopolitical conflicts between the United States and the European Union are a concern for international trade, as they affect not only the relationship between the two but also emerging markets, which are also a dependent part of this global supply chain. The deadlines set by the US are approaching, and negotiations are stalled, raising concerns among international investors and exporters. We hope that the two countries can seek a solution that is balanced for both sides.
GCN.com/Reuters
