1 week ago
22
EU leaders have expressed hopes of a speedy deal to resolve the trade war with the US after Donald Trump announced he was delaying his threatened 50% tariffs for the bloc until 9 July.
The US president said on Sunday that he would pause the border tax due to be imposed on 1 June, which he had only announced two days earlier, after what he called a “very nice call” with the head of the EU executive, Ursula von der Leyen.
The European commission president persuaded Trump to delay the duties by more than one month to give the two sides more time to negotiate.
Her chief spokesperson, Paula Pinho, said the pair had agreed “to fast-track the trade negotiations and to stay in close contact”. Von der Leyen initiated the call, the EU spokesperson said, adding “there was, it seems, a mutual intention to speak to each other”.
The EU trade commissioner Maroš Šefčovič is due to speak to US commerce secretary Howard Lutnick later on Monday. The pair last spoke on Friday, after Trump’s latest tariff threat.
The French president, Emmanuel Macron, said on Monday that he hoped Washington and Brussels could get to the lowest tariffs possible. “The discussions are advancing,” he told reporters during a trip to Vietnam.
“There has been a good exchange between President Trump and President Von der Leyen and I hope we can continue on this road and return to the lowest possible tariffs that will allow for fruitful exchanges.”
Italy’s prime minister, Giorgia Meloni, who is deemed to have one of the closest relationships to the White House among EU leaders, was reported by local media to be trying to organise a meeting between Trump and European leaders in early June.
Ireland’s foreign minister, Simon Harris, said there was “no time to waste” to find a deal that is good for the US and EU economies. “These contacts at the highest political level present the opportunity for negotiations to move forward. This is our priority. We want to see meaningful and substantive talks,” he said.
Speaking on Monday, the commission confirmed that the EU’s “zero-for-zero” offer to eliminate tariffs on cars and industrial goods in transatlantic trade remained on the table. “We believe that is a very attractive starting point for a good negotiation that could lead to benefits on both sides of the Atlantic,” trade spokesperson Olof Gill said.
The commission declined to comment on the detailed talks between Trump and von der Leyen.
Von der Leyen had a brief exchange with Trump at the Pope’s funeral last month, her first since his return to the White House. Analysts have suggested the US president, who has repeatedly voiced hostility towards the EU and multilateral institutions, prefers to deal with national leaders.
Trump initially announced a 20% levy on EU goods being sold into the US as part of his “liberation day” tariffs unveiled on 2 April, but a week later he reduced that to 10% to allow for time for talks. However on Friday, he claimed negotiations were “going nowhere”, upped the rate to 50% and brought the deadline forward to 1 June.
European markets rose on Monday on the news the EU now faces a 10% duty until 9 July, with the Stoxx Europe 600 index reversing Friday’s losses. US markets were closed for a public holiday on Monday, but futures rose on the U-turn news.
The flip-flopping on border taxes has left many businesses unsure of what plans to make, with many withdrawing their financial forecasts in response.
Trump’s 25% tariffs on steel, aluminium and cars remain in place. Šefčovič held a video conference on Monday with the chief executives of the carmakers Mercedes-Benz, Volkswagen, BMW and Stellantis to reassure them.
The EU has suspended its retaliatory tariffs on €21bn (£18bn) of US agricultural and industrial goods in Republican states, but they will kick in on 14 July without a deal. The European commission is also consulting member states and European industry on a further round of retaliatory tariffs targeting €95bn (£80bn) of US goods, including bourbon, cars and industrial machinery.
The commission has previously said it has not ruled out targeting US tech firms or banks, a potent but politically explosive target, as the US runs a €109bn (£91bn) trade surplus with the EU in service industries. Trump is more focused on the US trade deficit in goods, worth €198bn (£166bn) in 2024.
Speaking before Trump’s latest round of on-off tariff threats, a senior EU diplomat said all options for retaliation were on the table, but stressed the wish for a settlement: “At the moment we still want to be de-escalatory and in a negotiating mood.”
