The European Union (EU) is intensely lobbying and consulting to identify counter-measures against US imports. Those imports are worth €95 billion right now as the storm clouds gather in transatlantic trade relations. European Commission President Ursula von der Leyen announced that an equitable deal was urgently needed no later than July 9. She welcomed the fact that the EU had agreed to negotiate in a swift and serious manner.
France and Germany have led calls within the European Union for a purely diplomatic resolution to the two-year-long trade spat. They argue that any tariffs would be detrimental to both economies. The EU’s proposed 25% tariff on €18 billion worth of US goods was previously put on hold, highlighting the bloc’s desire to avoid further escalation in an already strained relationship.
Unfortunately, even with these great efforts, the backdrop of continuing tariffs is hard to miss. The Trump-era 25% tariff on EU steel and aluminum still weighs heavily on the state of transatlantic trade. President Donald Trump has been very vocal about his disdain for the EU over what he perceives as unfavorable trade treatment. Last month, he followed that up with a shock 20% tariff on nearly all EU imports. Yet, he subsequently announced that he would lower this tariff to 10% until July 8 to enable negotiations.
The EU is the second largest trading partner and third largest export market for Washington State. Last year, European exports to the US exceeded $600 billion, and imports from the US reached $370 billion. That’s a huge trade volume, which makes it all the more critical to work through those differences quickly.
Maroš Šefčovič, the EU’s trade chief, reiterated the bloc’s determination not to let the EU miss out on a bad deal. He stated, “The EU’s fully engaged, committed to securing a deal that works for both.”
Von der Leyen echoed this sentiment, stating, “To reach a good deal, we would need the time until 9 July.” She underscored that EU US trade must be grounded in mutual respect. Rather than making threats, the EU is prepared to use their power to protect their interests.
European leaders are already sounding the alarm on this escalation to extreme tariffs. Their concern is that extended talks might lead to real trade wars. With both sides still souring on the deal, the situation is fluid and both parties are increasingly looking towards July as their key deadline.