Monday 24 June 2019

EU readies list of new imports to hit if Trump goes after cars

Cecilla Malstrom
Cecilla Malstrom

Philip Blenkinsop

The European Commission will impose new tariffs on as much as €9bn of US imports, if America targets car imports with new levies.

The European Union's trade commissioner said yesterday that she hopes an EU mission to Washington next week will ease the transatlantic trade dispute, but that Europe is preparing a list of US imports to hit if the United States imposes tariffs on EU cars.

Trade Commissioner Cecilia Malmstrom will travel to Washington on July 25 with European Commission President Jean-Claude Juncker, with the latter due to hold talks focused on trade with US President Donald Trump.

The United States imposed tariffs on EU steel and aluminium on June 1 and Mr Trump is threatening to extend them to EU cars and car parts. The EU responded by imposing its own import tariffs on €2.8bn worth of US products ranging from whiskey to motorbikes.

Ms Malmstrom said the US car sector was healthy and that no one involved in the sector had called for tariffs.

"We are preparing together with our member states a list of rebalancing measures there as well. And we have made that clear to our American partners," she told a conference hosted by the German Marshall Fund of the United States in Brussels.

Tariffs on cars would be on a much bigger scale than the US action to date. EU car and car part exports are worth €51bn.

The Commission on Wednesday briefed representatives of EU countries on possible action.

One EU diplomat familiar with the talks said the Commission gave no examples of US products that might be hit, but said they could in theory total €9bn, although it could also go for a larger list of products with lower tariffs.

Read more:

In Ireland, officials yesterday declined to discuss the potential sectors that could be hit next, but consumers here are already facing the threat of rising costs or the need to find substitutes for some everyday imports like peanut butter, cosmetics, orange juice and jeans. President Trump's top economic adviser Larry Kudlow has said that he expects Mr Juncker to come with a significant trade offer. EU officials have downplayed suggestions he will arrive with a novel plan to restore good relations.

Some reports have said that a multilateral deal to remove car tariffs was one idea put forward. Ms Malmstrom yesterday questioned the viability of such a plan and also said a bilateral deal with the US to scrap car tariffs could only be done if part of a broader trade agreement.

"The aim of President Juncker's visit is to try to establish good relations, try to see how we can de-escalate the situation, avoiding it going further and see if there is a forum where we can discuss these issues," Ms Malmstrom said.

Meanwhile, the EU is pressing ahead with free trade talks with Latin American bloc Mercosur.

Irish farm groups are wary of any agreement that would ease imports of beef into the EU, but a deal is close to being concluded, with a final push over the line seen by early September, Argentina's foreign minister said yesterday.

EU negotiations with the Mercosur group of Argentina, Brazil, Paraguay and Uruguay, the world's fourth largest trading bloc, have been going on for almost 20 years. (Reuters)

Irish Independent

Also in Business