Zippyjuan
10-22-2018, 12:14 PM
http://time.com/5430547/trump-european-union-trade-talks/
Trump wanted a deal done before the elections so he could declare victory. He did declare victory this summer despite there being no progress in trade talks with Europe.
(Bloomberg) — The European Union and U.S. are reviewing their trade ties, spurred by U.S. accusations that the bloc is duping American businesses. But don’t expect a complete overhaul of their more than $1 trillion commercial relationship anytime soon.
Even though President Donald Trump notified Congress Oct. 16 that the U.S. intends to begin official trade talks with the 28-nation EU, formal negotiations are yet to get underway and quarreling between the two sides signals an arduous process lays ahead.
The Trump administration in June hit the EU with steel and aluminum tariffs, prompting rapid retaliation from Brussels against iconic American products like bourbon whiskey and Harley-Davidson motorcycles.
A descent into an all-out trade war was averted in July when European Commission President Jean-Claude Juncker and Trump agreed to a Rose Garden truce and an outline for limited talks.
The resulting discussions between the historic allies remain tense, however. And limited, with the EU insisting the sensitive subject of agriculture be left out and Washington excluding any discussions on the trans-Atlantic trade in cars.
Hanging heavily over the talks is Trump’s threat to impose a tariff of up to 25 percent on imports of cars and parts into the U.S. aimed largely at Germany, the EU’s largest economy, and companies like BMW AG and Daimler AG.
Car Tax
Trump has agreed not to go ahead with the new auto import taxes as long as negotiations are underway. European officials remain wary, however. And the U.S.’s heavy-handed approach signals how hard it will be for the two sides to come to terms on delicate trade issues, according to Peter Chase, a senior fellow at the German Marshall Fund.
“There’s not a lot of goodwill there and goodwill is a necessary part of any trade negotiation,” Chase said by phone.
Rufus Yerxa, president of the Washington-based National Foreign Trade Council and a former senior U.S. trade official, said a comprehensive transatlantic deal would require “some painful concessions on both sides” that it was not clear either side was willing to make.
“We have our sacred cows and they have their sacred cows,” Yerxa said, citing as examples the U.S.’s 25 percent tariff on light trucks and European protections on the financial services sector. “Obviously business wants a big deal with Europe, but a big deal with Europe is a hard thing to achieve.”
While the Trump administration on Oct. 16 notified Congress, Cecilia Malmstrom, the EU’s chief trade negotiator, has not yet sought the mandate from EU member states she needs to begin formal talks. Lower-level officials from both sides are due to meet in Washington this week to prepare for a meeting between U.S. Trade Representative Robert Lighthizer and Malmstrom for late November.
The lack of an EU mandate represents a potential departure from the July agreement, when the EU and U.S. pledged to work “toward zero tariffs, zero non-tariff barriers, and zero subsidies on non-auto industrial goods.” France and other member states remain divided over the scope of the negotiations, according to two European officials who spoke on the condition of anonymity.
Instead, the EU is focusing on better regulatory cooperation with the U.S. for industries including autos, pharmaceuticals and medical devices. While the path wouldn’t require a formal negotiating mandate from EU countries and both sides spent years discussing it during the Obama administration’s push for a broad Transatlantic Trade and Investment Partnership, or TTIP, it’s still a complicated process that will take time.
Quick Wins
“The administration wants quick wins,” Chase said. “They’re not going to get any quick wins on the regulatory front.”
Trump cancelled nearly completed TTIP talks which would have eliminated over 90% of EU tariffs.
Trump wanted a deal done before the elections so he could declare victory. He did declare victory this summer despite there being no progress in trade talks with Europe.
(Bloomberg) — The European Union and U.S. are reviewing their trade ties, spurred by U.S. accusations that the bloc is duping American businesses. But don’t expect a complete overhaul of their more than $1 trillion commercial relationship anytime soon.
Even though President Donald Trump notified Congress Oct. 16 that the U.S. intends to begin official trade talks with the 28-nation EU, formal negotiations are yet to get underway and quarreling between the two sides signals an arduous process lays ahead.
The Trump administration in June hit the EU with steel and aluminum tariffs, prompting rapid retaliation from Brussels against iconic American products like bourbon whiskey and Harley-Davidson motorcycles.
A descent into an all-out trade war was averted in July when European Commission President Jean-Claude Juncker and Trump agreed to a Rose Garden truce and an outline for limited talks.
The resulting discussions between the historic allies remain tense, however. And limited, with the EU insisting the sensitive subject of agriculture be left out and Washington excluding any discussions on the trans-Atlantic trade in cars.
Hanging heavily over the talks is Trump’s threat to impose a tariff of up to 25 percent on imports of cars and parts into the U.S. aimed largely at Germany, the EU’s largest economy, and companies like BMW AG and Daimler AG.
Car Tax
Trump has agreed not to go ahead with the new auto import taxes as long as negotiations are underway. European officials remain wary, however. And the U.S.’s heavy-handed approach signals how hard it will be for the two sides to come to terms on delicate trade issues, according to Peter Chase, a senior fellow at the German Marshall Fund.
“There’s not a lot of goodwill there and goodwill is a necessary part of any trade negotiation,” Chase said by phone.
Rufus Yerxa, president of the Washington-based National Foreign Trade Council and a former senior U.S. trade official, said a comprehensive transatlantic deal would require “some painful concessions on both sides” that it was not clear either side was willing to make.
“We have our sacred cows and they have their sacred cows,” Yerxa said, citing as examples the U.S.’s 25 percent tariff on light trucks and European protections on the financial services sector. “Obviously business wants a big deal with Europe, but a big deal with Europe is a hard thing to achieve.”
While the Trump administration on Oct. 16 notified Congress, Cecilia Malmstrom, the EU’s chief trade negotiator, has not yet sought the mandate from EU member states she needs to begin formal talks. Lower-level officials from both sides are due to meet in Washington this week to prepare for a meeting between U.S. Trade Representative Robert Lighthizer and Malmstrom for late November.
The lack of an EU mandate represents a potential departure from the July agreement, when the EU and U.S. pledged to work “toward zero tariffs, zero non-tariff barriers, and zero subsidies on non-auto industrial goods.” France and other member states remain divided over the scope of the negotiations, according to two European officials who spoke on the condition of anonymity.
Instead, the EU is focusing on better regulatory cooperation with the U.S. for industries including autos, pharmaceuticals and medical devices. While the path wouldn’t require a formal negotiating mandate from EU countries and both sides spent years discussing it during the Obama administration’s push for a broad Transatlantic Trade and Investment Partnership, or TTIP, it’s still a complicated process that will take time.
Quick Wins
“The administration wants quick wins,” Chase said. “They’re not going to get any quick wins on the regulatory front.”
Trump cancelled nearly completed TTIP talks which would have eliminated over 90% of EU tariffs.