[CTC] EU Diplomats Give Green Light to U.S. Trade Talks

[Arthur Stamoulis]

https://www.bloomberg.com/news/articles/2019-04-11/eu-diplomats-are-said-to-give-green-light-to-u-s-trade-talks <https://www.bloomberg.com/news/articles/2019-04-11/eu-diplomats-are-said-to-give-green-light-to-u-s-trade-talks>


EU Diplomats Give Green Light to U.S. Trade Talks

By Jonathan Stearns <https://www.bloomberg.com/authors/AFlBzj8L2BQ/jonathan-stearns> 
4/11/2019
 
European Union ambassadors gave the go-ahead for trade talks with the U.S. as the bloc seeks to keep at bay the threat of American automotive tariffs, according to two officials with knowledge of the decision.

Envoys from the 28-nation EU approved a mandate for the EU’s trade chief, Cecilia Malmstrom, to negotiate cuts in industrial tariffs with the U.S., the officials said on the condition of anonymity because the deliberations were behind closed doors.

The green light on Thursday in Brussels came after France won concessions on wording related to the environment and to a previous, now shelved, plan for a broader transatlantic commercial deal. EU ministers still need to give their rubber stamp, which is due on April 15.

Malmstrom is rushing to begin deliberations with the U.S. on slashing industrial tariffs in a bid to show President Donald Trump progress in enacting a July 2018 political accord that he reached with her boss, European Commission chief Jean-Claude Juncker.

The deal between Trump and Juncker suspended the threat of U.S. levies on EU cars and auto parts that would be based on the same national-security grounds used by the White House to apply controversial duties last year on foreign steel and aluminum. At the same time, the pact struck nine months ago expressed a desire to resolve the dispute over the American metal levies, which prompted the European side to retaliate with tit-for-tat duties <https://www.bloomberg.com/news/articles/2018-06-20/eu-retaliation-against-u-s-over-metal-tariffs-to-start-june-22>.

The all-clear for negotiations to remove industrial duties is no guarantee that the commercial truce between the EU and U.S. will last.

As Trump seeks an accord to end his trade war with China <https://www.bloomberg.com/news/articles/2019-04-10/u-s-and-china-agree-to-enforcement-offices-in-trade-talks>, EU refusal to include agriculture in the transatlantic talks and an apparent U.S. desire to exclude automotive goods risk sparking renewed tensions.

And separately, the Trump administration this week announced a plan to impose tariffs on $11 billion of European goods as a result of alleged subsidies to plane maker Airbus SE <https://www.bloomberg.com/quote/AIR:FP>. The EU reacted by saying it was preparing similar action against American products concerning aid to Boeing Co.

In a Twitter post on Wednesday, Trump called the EU “a brutal trading partner with the United States, which will change.”

The removal of transatlantic tariffs on industrial goods would expand U.S. exports to the EU by 13 percent and the bloc’s shipments to the American market by 10 percent, the commission said in January. The average tariff on non-farm products is 4.2 percent in the EU and 3.1 percent in the U.S., according to the commission.
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