The U.S. Administration wants the EU to make unilateral cuts to its tariffs on American goods and abolish a proposed digital tax for trade negotiations to advance, sources briefed on the U.S. trade negotiators’ latest stance have told the Financial Times.
The U.S. hit the EU with a 20% ‘reciprocal’ tariff in early April, but the Trump Administration later backtracked on the so-called reciprocal tariffs following a major market rout triggered by fears of recession. The United States has now left a baseline 10% tariff on all countries by July 8 as it is engaging in negotiations to secure trade deals.
The U.S., however, kept the 25% tariff on EU steel, aluminum, and car parts. Washington is also threatening additional tariffs on pharmaceuticals and semiconductors.
The U.S. is set to communicate to the EU’s trade negotiators on Friday that the bloc should make unilateral concessions and cut tariffs on U.S. goods, instead of seeking mutual cuts to the tariffs, according to FT’s sources. The Trump Administration is also unhappy that the EU’s proposal for negotiations did not include abolishing the proposed digital tax.
Early last month, the EU proposed mutual zero tariffs.
European Commission President Ursula von der Leyen said in early April that “Europe is ready to negotiate with the US.”
“We have offered zero-for-zero tariffs for industrial goods. Because we’re always ready for a good deal. But we’re also prepared to respond with countermeasures. And protect ourselves against indirect effects through trade diversion,” von der Leyen added.
U.S. President Donald Trump has dismissed the ‘zero-for-zero tariffs’ offer and told reporters in the White House who asked if the EU offer was sufficient to back down on tariffs on the EU, “No, it’s not.”
The U.S. has made one trade deal – with the UK – since backing off tariffs temporarily to start negotiations. A failure in the U.S.-EU trade talks wouldn’t be good for the economies of either party and could dampen the prospects of oil demand growth.
By Tsvetana Paraskova for Oilprice.com
More Top Reads From Oilprice.com
- Oil Set for Weekly Dip on OPEC+ Output Plans
- Asian Buyers Increase Purchases of Murban Oil
- Pemex Announces 3000 Job Cuts in Restructuring Effort
