Monday

27th May 2019

Trump keeps EU leaders waiting on tariffs

  • (Photo: Consilium)

EU leaders were left in the dark on Thursday (22 March) after the US president failed to detail under which conditions European steel and aluminium could be exempted from tariffs that will be put in place on Friday.

Gathered in Brussels for one of their regulars summits, they waited in vain until 1AM on Friday for Donald Trump to publish the formal decision confirming the exemption.

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They decided to postpone their discussion on the issue until 9AM on Friday. Theresa May, who had planned to be back in London because Friday's planned agenda was about Brexit and the eurozone, will attend the meeting.

"We will have to wait overnight how exactly the decision of the US government will look like," German chancellor Angela Merkel said after the meeting.

She added that EU countries were "united" and were "ready" for counter measures if tariffs were imposed on the EU.

EU leaders are expected to express their support for the European Commission as the bloc's trade negotiator and their willingness to continue in dialogues with the US to find a solution to the trade dispute as well as to steel overcapacities on the world market.

"We need to avoid protectionism at the global level. This is a major risk for jobs, not only in Europe. In this respect, dialogue with the US is key," European Council president Donald Tusk told journalists during the summit.

But the tone of the EU reaction will depend on what the US officially publishes, an EU source said, explaining why the leaders preferred to wait.

It was a day of expectations and caution for the EU, with officials warning that with Trump, nothing can ever be taken for granted. 


In the morning, EU trade commissioner Cecilia Malmstroem, who was back from Washington where she had had talks with US trade representative Robert Lighthizer, told MEPs that she "hoped" that the EU would be on a list of exempted countries that was to be published later that day.

Just as EU leaders were starting their summit, Lighthizer told members of the House of Representatives that EU countries would indeed be on list.

But as hours went by, with Trump announcing tariffs worth $50bn on Chinese imports and firing his national security adviser, the US administration seemed not to be in a hurry to give more information to the EU.

The leaders wanted to know for how long EU steel and aluminium would be exempted, and what Trump would ask in return.

"The devil is often in the details", Belgian prime minister Charles Michel pointed out.

"We take note of Donald Trump's concerns with the US trade deficit," he said.

Signals from Washington suggested that Trump would like to negotiate lower tariffs with the EU on other products.

But Europeans were clear that they would not engage in new free-trade discussions with the US, over a year after the failure of talks for a EU-US free trade agreement, TTIP.


"A TTIP-like global negotiation, or even a TTIP-lite - only on tariffs - in these conditions, would be a mistake and an admission of weakness," said a French presidency source.

"We can work on limited issue in the trade relationship, but we have to be watchful not to slide into a TTIP-like negotiation," the diplomat said.

If the US were to insist on EU concessions with a threat to impose the tariffs, the EU would trigger a set of measures that have been presented by the commission earlier this month.


The measures include taking the US to the World Trade Organisation court and imposing tariffs on a range of US products, from whiskeys and Harley-Davidson motorbikes to electrical goods.

EU insists on US tariffs exemption

Europe is "an ally, not a threat", the EU Commission says - as the US is poised to impose duties in steel and aluminium. Common action on Chinese steel overcapacity could help diffuse the crisis.

Trump starts countdown to EU trade war

EU sales of steel to US to face 25 percent tariff from 23 March, with Europe to hit back on motorbikes and bourbon in looming trade war.

EU rejects US trade 'gun to the head'

EU leaders demanded a permanent exemption from US tariffs on steel and aluminium - and ruled out any bilateral trade talks within the 1 May deadline set by Donald Trump.

Agenda

Tariffs and Turkey will top This WEEK

The EU will maintain pressure on the US to resolve a tariff dispute. On Monday, European Commission president Juncker, along council president Tusk, will discuss relations with Turkey's president Erdogan. Additional national measures against Russia are also expected.

EU pessimistic on permanent US trade exemption

EU trade chief said the US will impose tariffs or "other limiting measures" on 1 June, as the EU's offer to start limited trade talks is probably not enough for the protectionist Trump presidency.

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