【By Observer News, Wang Kaiwen】 The "tariff deadline" set by the Trump administration is approaching, and in the face of the US's escalating pressure, its Western allies have recently shown signs of concession.

According to Bloomberg on June 30, the EU will accept a 10% general tariff from the US but seeks exemptions in key industries. On June 29, Canada had announced it would abandon the digital services tax to advance trade negotiations with the US.

"Clear Concessions"

According to reports, the EU is willing to accept a trade agreement with the US, including a 10% general tariff on many goods exported by the EU to the US. However, the EU hopes that the US will commit to lowering tariff rates in key areas such as pharmaceuticals, wine, semiconductors, and commercial aircraft.

According to informed sources, the EU also urged the US to grant quotas and exemptions to reduce the 25% tariff on cars and car parts and the 50% tariff on steel and aluminum.

These unnamed sources said that the European Commission, which handles EU trade affairs, believes the above arrangements are beneficial to the US to some extent, but still within the range acceptable to the EU.

According to Hong Kong's South China Morning Post, the EU's willingness to accept a 10% general tariff from the US is undoubtedly a "clear concession."

After President Trump announced on April 2nd the so-called "reciprocal tariffs" for all countries and regions around the world, he announced on April 9th a 90-day delay in imposing "reciprocal tariffs" on certain trading partners, maintaining a 10% "base tariff" during this period, while pressuring trading partners to complete trade negotiations with the US before July 8th.

On April 2nd local time, Trump signed an executive order at the White House to announce the so-called "reciprocal tariffs." White House video screenshot

However, in May, Trump suddenly threatened to impose a 50% tariff on imports from the EU starting June 1st this year. After a call with EU Commission President von der Leyen, Trump changed his mind again, stating he was willing to delay the imposition until July 9th.

Data compiled by the EU and ING analysts show that the US is the largest export destination for EU automobiles and parts, with related exports reaching 52.8 billion euros (about 62.2 billion USD) in 2024. According to data from the Vienna Institute for International Economic Studies, the EU also exported 24 billion euros of steel and aluminum products to the US, with Germany, Italy, and France being the largest exporters.

Bloomberg earlier reported that the EU and the US are increasingly confident in reaching a temporary agreement before July 9th to allow negotiations to continue after the deadline. According to insiders, the agreement will cover tariffs and non-tariff barriers, procurement of key US goods, and outline cooperation in other areas.

Bloomberg cited insiders who said the European Commission hopes that current industry tariffs implemented by the US, such as those on cars and metals, as well as future planned tariffs by Washington, can be addressed at the beginning of the agreement.

In addition, the EU hopes to resolve non-tariff barriers by simplifying the agenda and has proposed exploring "strategic procurement" in areas such as liquefied natural gas and artificial intelligence technology. The EU is also willing to cooperate with the US on "common economic security challenges."

The EU estimates that the current tariffs imposed by the US cover products worth 380 billion euros, accounting for about 70% of the EU's total exports to the US.

EU lists four possibilities

This week, the EU Commissioner for Trade and Economic Security, Šefčovič, will lead a delegation to Washington to try to push the EU-US negotiations forward. According to reports, the EU still believes that reaching a "principle agreement" is the best outcome, although they have not yet clarified how long such an agreement could last.

According to Reuters, Šefčovič plans to hold talks with US Trade Representative Katherine Tai and US Commerce Secretary Gina Raimondo on July 2nd and 3rd.

Šefčovič stated that the EU is pushing for a "fair" tariff agreement for both sides and providing more predictability for businesses.

Photo: Šefčovič, Visual China

According to sources quoted by Bloomberg, the European Commission informed member states on Monday that it has received a proposal from the US covering tariffs, non-tariff trade barriers, and areas of strategic cooperation. However, specific details of the proposal, such as possible tariff rates, were not shared with member states.

EU officials listed four possible scenarios that may occur before the July 9th deadline: 1. An acceptable asymmetric agreement is reached. 2. The US proposes an unbalanced agreement that the EU cannot accept. 3. The deadline is extended to continue negotiations. 4. Trump withdraws from the negotiations and raises tariffs.

According to insiders, if the fourth scenario occurs, the EU is likely to take comprehensive retaliatory measures.

The EU has already approved additional tariffs of up to 50% on $21 billion worth of US goods to respond quickly to Trump's metal tariffs. In addition, the EU has prepared another list of tariffs, including $95 billion worth of US products, to respond to Trump's "reciprocal tariffs" and car tariffs.

Šefčovič confirmed that the EU has received the first draft of the US proposals for the final agreement. "July 9th is just around the corner, so for me, moving from the stage of exchanging views to drafting is always a positive signal," he said.

Before the EU was revealed to be willing to accept the US's general tariff, Canada also decided to cancel the 3% digital services tax that greatly upset Trump.

The Canadian digital services tax came into effect on June 28, 2024, and is retroactive to January 1, 2022. Companies must pay the tax starting June 30, 2025. The digital services tax applies to taxpayers with global annual revenues of 750 million euros (about 833 million USD) and digital service revenues of 20 million Canadian dollars (about 14.3 million USD) in Canada. This means American tech giants like Amazon, Google, and Meta will also be affected.

However, on Friday, June 27, Trump posted on social media, directly calling Canada's move "a direct and blatant attack on our country," and said, "based on this extremely恶劣 tax, we hereby declare that we immediately terminate all trade negotiations with Canada."

Subsequently, the Canadian government issued a news release on June 29, announcing the cancellation of the digital services tax in order to "reach a mutually beneficial comprehensive trade agreement with the US." The White House stated that after the tax was canceled, US-Canadian trade negotiations had resumed.

It is worth noting that in his post on June 27, Trump also specifically mentioned Canada's digital services tax as "copying the EU." In April this year, the EU Commission ruled that US tech giants Apple and Meta violated the EU's Digital Markets Act, imposing fines totaling 700 million euros on the two companies.

EU Commission Spokesperson Thomas Rayner emphasized on June 30 that the EU's Digital Markets Act and Digital Services Act are not part of the EU-US trade negotiation agenda.

When will it be discussed?

The temporary period for the US to impose "reciprocal tariffs" on trade partners is about to end, but so far, among the US's allies, only the UK has reached a limited trade agreement with the US.

Obstacles in the negotiation process have led Trump to repeatedly make tough threats. In addition to Canada, Trump posted on his self-created social media platform "Truth Social" on June 30, accusing Japan of not accepting US rice, and called this ally country "spoiled," implying ending trade negotiations.

The White House had previously stated that the negotiation deadline set by Trump "was not important."

"Perhaps these deadlines can be extended, but that will be decided by the president," White House Press Secretary Karoline Leavitt said on June 26, "If these countries refuse to reach an agreement with us before the deadline, the president can directly offer them an agreement."

In a Fox News program "Sunday Morning Futures" (recorded on June 26) aired on June 29, Trump first said he did not think it was necessary to extend the tariff deadline, then added, "I can also extend it, no big deal."

US Treasury Secretary Becerra said on June 26 that the US and major trading partners' trade agreements may be completed before the US Labor Day on September 1st this year.

Original article: https://www.toutiao.com/article/7521963584965755442/

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