Slim prospects for settling the US-EU trade disagreement concerning tariffs, according to an analyst's opinion.
Title: US-EU Trade Deadlock: Expert Sheds Doubts on Deal Amid Tariff Raising
Subtitle: Ignacio García Bercero, former EU official and Bruegel think tank expert, discusses the chances of a deal amid US tariff hikes.
A Little Insight: Brussels and Washington have struggled to break the trade impasse since March, and a recent announcement by President Trump to raise steel and aluminum tariffs from 25% to 50% casts further doubt on reaching a deal within the designated 90-day period.
The possibility of a US-EU trade agreement seems remote after the US President indicated a surge in tariffs on aluminum and steel from 25% to 50%. Ignacio García Bercero, a former senior EU official and expert at the Bruegel think tank, expressed his skepticism in an interview with our website.
"From my perspective, it appears that the US is not eager to make concessions to ease the impact of the tariffs on steel, aluminum, and cars," García Bercero stated.
As a result, he doubts that a negotiated agreement can be reached. "It's tough to envision any kind of breakthrough," he admitted.
The US President announced the increase of existing tariffs on steel and aluminum imports, including EU imports, to 50% as of June 4. The imposed tariffs add to the existing 25% US tariffs on cars and 10% US levies on all EU imports.
A US Court of International Trade recently ruled that an emergency law invoked by Trump did not grant him unilateral authority to impose the 10% tariffs, ordering an immediate halt to them. However, the court did not challenge the tariffs on steel, aluminum, and cars as they were grounded on a different law pertaining to national security.
Furthermore, various US investigations are underway into the pharmaceutical, semiconductor, and aircraft industries, which may result in additional US tariffs.
García Bercero pointed out that the US seems unyielding regarding the 10% tariffs, which are currently suspended due to a court ruling. "They show no intention of acting on those tariffs, which are being challenged by a US court," he noted.
He also expressed concerns about the tariffs based on national security, which target steel, aluminum, and cars or car parts. "To be honest, I don't see how a deal can be reached," he said.
García Bercero suggested that the EU should implement countermeasures, particularly on steel, aluminum, cars, and car parts, in response to the ongoing situation.
Deadlines are approaching quickly, as the EU has postponed until July 15 a first list of US products worth €21 billion in retaliation for the steel and aluminum tariffs. A second package worth €95 billion worth of US goods is under discussion, to target EU-US trade in case negotiations fail. Additional countermeasures on steel and aluminum would need to be adopted by EU member states.
As recent developments indicate, tensions between the US and EU are running high, and the road ahead for a trade deal remains steep. "I'm not optimistic, but we must continue talks to see if the US will eventually budge," García Bercero concluded.
- The ongoing tariff disputes in the US-EU trade relations have also extended to the finance industry, as the increased tariffs on steel and aluminum could affect the cost of production for various businesses in both regions.
- In light of the current political standoff between the US and EU, the general news media is closely monitoring the progress (or lack thereof) in negotiations, as well as the potential ramifications of the trade deadlock on both parties.
- Given the resistant behavior of the US administration towards reducing the 10% tariffs on various imports (currently under legal challenge), the crime-and-justice sector could potentially experience increased activity due to potential smuggling and illicit trade strategies employed by businesses seeking to bypass these high tariffs.
