Financial Times: Trump will impose a minimum tariff of 15% to 20% on EU goods
The previous U.S.-EU framework agreement had proposed maintaining a base tariff of 10% for most goods, but Trump clearly was not satisfied with this. If an agreement is not reached by August 1st, Trump has threatened to impose a 30% tariff on all imported products at that time.
U.S. President Trump is reportedly increasing his demands in trade negotiations with the EU. The British Financial Times (Finanial Times) disclosed on Friday that Trump is demanding that any trade agreement with the EU include a minimum tariff of 15% to 20% on all EU goods. In addition, even if an agreement is reached, the Trump administration is considering setting reciprocal tariff rates above 10%, a position that has led to a deadlock in trade negotiations and caused a strong reaction from the EU.
According to reports, Trump's hardline stance is intended to test the EU's ability to withstand pressure in trade negotiations, and he hopes to increase the base tariff for most goods from 10% to 15% to 20%. The previous framework agreement had proposed maintaining a base tariff of 10% for most goods, but Trump clearly was not satisfied with this proposal and emphasized that if the EU wants to reach an agreement, it must accept higher tariff requirements.
The report cited sources who said that Trump remained indifferent to the EU's latest proposal to reduce car tariffs. He wanted to keep the tariff level for this industry at 25% as planned.
The EU expressed disappointment with Trump's hardline attitude. EU Trade Commissioner Šefčovič told EU ambassadors during a meeting in Washington that the EU did not see any substantial concessions from Trump's position.
The pressure on the EU is increasing as the August 1st deadline approaches. Trump previously threatened that if the EU could not reach an agreement, he would impose a 30% tariff on all EU imports. There is a division within the EU on whether to retaliate, but diplomats said that if Trump insists on imposing a permanent reciprocal tariff of 15% to 20%, it would lead to a stronger response from the EU, and it might have to accept a base tariff above 10%.
The EU is concerned about Trump's demands, but also expressed a desire to avoid a trade war. EU diplomats pointed out that if Trump does not back down, the EU will be forced to consider retaliatory measures. The EU has already planned some counter-tariff schemes, which would impose retaliatory tariffs on American chicken, jeans, Boeing aircraft, and bourbon whiskey if the negotiations fail.
In addition, the EU has prepared a third list of retaliatory measures, including taxes on digital services and revenue from online advertising. These measures show the EU's response to Trump's hardline stance and could have significant implications for bilateral trade relations.
The latest news about Trump's hardline demands on the EU triggered a drop in the U.S. stock market, reflecting the market's concerns about the uncertainty of future trade negotiations. Despite this, Trump's tariff policies may not cause serious damage to the U.S. economy. According to the report, the U.S. collected nearly $5 billion in additional tariffs in the second quarter, and major trading partners have not taken large-scale retaliatory measures.
Although the EU has shown different attitudes towards the U.S. trade policy, German Chancellor Merkel stated during a meeting on Friday that the U.S. still harbors doubts about the EU's proposal to reduce industry tariffs. Merkel noted, "Whether we can create industry rules and whether individual industries can be treated differently from other industries remains an unresolved issue."
The divisions within the EU indicate that there is no consensus on how to respond to Trump's trade policy. A senior diplomat said, "The atmosphere has clearly changed," and now the EU side is more supportive of taking retaliatory measures rather than continuing to compromise.
Trump's trade policy has been known for its hardline approach since April, and it has had a considerable impact on global stock markets.
In early April, Trump imposed high tariffs on almost all of America's trade partners, although they were later reduced to 10% within 90 days. However, as the U.S. stock market continued to set new highs, the market seemed to react less strongly to Trump's tariff threats.
Trump has sent a new round of tariff letters to more than 150 small trading partners, with the proposed base tariff levels ranging between 20% to 40%, except for 50% tariffs on Brazilian goods, and involving trade issues with Canada and Mexico among others.
Original: https://www.toutiao.com/article/1838064499321865/
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