Unexpected development following the phone conversation: Remarks by Donald Trump
United States President Donald Trump has decided to postpone the implementation of new tariffs on EU imports, initially scheduled for early June, by about a month. The new tariffs, set at 50%, will now take effect on July 9, Trump announced after speaking with European Commission President Ursula von der Leyen. Von der Leyen indicated a readiness to initiate talks promptly, as confirmed by Trump on his online platform Truth Social.
Prior to Trump's announcement, von der Leyen stated on an unspecified platform that the EU and the United States share one of the most significant and close trade relationships in the world. She emphasized the EU's preparedness to accelerate the negotiations, albeit with a July 9 timeline. This date is significant as it marks the end of a 90-day suspension of other tariffs that Trump had announced in April, intended to facilitate negotiations. Concurrently, the EU also announced it would temporarily halt planned counter-tariffs on US products for three months.
However, Trump's tariff announcement came unexpectedly over the weekend, with little indication of compromise. "I'm not looking for a deal," Trump mentioned at the White House. He justified the drastic step due to the slowed negotiations, causing the DAX to plummet to a two-week low. European goods, such as German products, would become considerably more expensive in the US if the high tariffs were to materialize.
Despite Trump's assurance, there remains uncertainty about whether the new tariffs on EU imports will indeed be implemented as announced with such short notice. Trump has previously made similar threats, only to rescind them later. These tariff threats are often used as a bargaining tactic by the Republican.
Recently, the US sealed a trade agreement with the UK to avoid high tariffs and has also negotiated a reduction in mutual tariffs with China. To resolve the current trade dispute, the EU has already offered the US an agreement to eliminate all tariffs on industrial goods. However, the Trump administration has yet to respond to this offer. Additionally, new agreements, such as an expansion of US exports of liquefied natural gas (LNG) or increased imports of military technology and agricultural goods, could potentially reduce the US trade deficit with the EU.
The EU views Trump's tariffs as unjustified and incompatible with World Trade Organization (WTO) rules. In case negotiations fail, the EU has promised decisive action against US tariffs, including the imposition of counter-tariffs. Trump frequently accuses Europeans of exploiting the US in trade, believing the EU was established primarily to gain an advantage in trade with the US. He has criticized the EU for various trade barriers, high taxes, and unfair lawsuits against American companies.
To balance global trade, Trump desires to impose higher tariffs on imports into the United States. However, the success of this strategy is uncertain, and politically, these tariffs carry risks for the Republican, as they could lead to price increases. The European Union is advised to strengthen its economic resilience and develop contingency plans in case negotiations fail and tariffs are implemented. Both sides continue their behind-the-scenes negotiations in hopes of reaching a resolution.
- This unexpected announcement of new tariffs on EU imports by Donald Trump is not isolated, as it appears to be a recurring tactic in Trump's politics, often used in policy-and-legislations and war-and-conflicts negotiations.
- Amidst the news of the postponed implementation of these tariffs until July 9, there remains a general-news uncertainty regarding their actual implementation, given Trump's history of rescinding such threats.
- As the EU and US continue their behind-the-scenes negotiations, the implementation of these 50% tariffs on EU business imports could have significant financial implications, potentially leading to price increases and impacting the overall state of finance and trade relations between the two entities.
