EU states OK talks on US trade deal in hopes of averting car tariffs

The EU-US trade relationship has been tense since US President Donald Trump raised steel and aluminium import tariffs in 2018, prompting Brussels to retaliate with several measures.
The EU-US trade relationship has been tense since US President Donald Trump raised steel and aluminium import tariffs in 2018, prompting Brussels to retaliate with several measures.PHOTO: AFP

BRUSSELS (DPA) - EU member states agreed on Monday (April 15) to launch negotiations on a trade deal with the United States, in hopes that the move will prevent US President Donald Trump from pressing ahead with threatened car import tariffs.

The mandate paves the way for formal talks to begin soon. Negotiators are also expected to discuss areas for closer cooperation on regulations, for example in pharmaceuticals.

The European Commission has been pressing since January for negotiations to start on a limited EU-US trade deal, but member states such as France hesitated due to domestic opposition, citing sensitivity ahead of EU elections in May.

The EU-US trade relationship has been tense since Mr Trump raised steel and aluminium import tariffs last year, prompting Brussels to retaliate with several measures.

In July, Mr Trump and EU Commission President Jean-Claude Juncker agreed to work on lifting tariffs for industrial goods, as well as whittling down trade barriers in several sectors, in an effort to ease the tensions.

But since then, Washington has accused Brussels of foot-dragging, and Mr Trump has threatened to impose high tariffs on EU automotive exports.

In February, the US Commerce Department presented Mr Trump with its findings after being asked whether any imbalance in the car trade harmed US national security - an assessment that would justify special tariffs.

 
 

Mr Trump has 90 days from the completion of the report - which is still confidential - to implement the tariffs.

There is currently a 2.5-per-cent tariff on cars imported into the US. Mr Trump has hinted that he could raise this to 25 per cent.