European Union Trade Commissioner Cecilia Malmstrom said a trans-Atlantic trade deal could be achieved before year-end, stressing a readiness to work speedily as the bloc tries to keep at bay the threat of US automotive tariffs.
Malmstrom said she expects EU governments to give her the go-ahead in March to start negotiations with the US to cut tariffs on industrial goods. A final agreement with President Donald Trump’s administration could be reached before the European Commission’s term ends on October 31, she said.
“I think it can be done during this mandate,” Malmstrom told reporters yesterday in Bucharest before a meeting of trade ministers from the 28-nation EU.
“We’re not delaying anything.”
Europe is rushing to show progress in enacting a political accord reached at the White House seven months ago to work toward reducing trans-Atlantic market barriers including industrial tariffs.
The pact last July put on hold the threat of US tariffs on EU cars and auto parts based on the same national-security grounds that Trump invoked to hit foreign steel and aluminium with duties. Those levies prompted tit-for-tat retaliation by the EU, which has vowed to act in a similar fashion should the US apply automotive levies.
A 25% US levy on foreign cars would add €10,000 ($11,346) to the sticker price of European vehicles imported into the country, according to the commission, the EU’s executive arm.
“It is important that we all agree on lowering tariffs internationally rather than on raising them,” Economy Minister Peter Altmaier of Germany, which has the most to lose from possible US curbs on imports of EU autos, told reporters in Bucharest.
With EU exports of cars and auto parts to the US valued at €58bn in 2017, Germany isn’t the only country in the bloc worried about the possibility of those shipments being targeted by Trump. Swedish Trade Minister Ann Linde said in Bucharest that such a move could lead to the loss of 4,000 auto-industry jobs in Sweden, which is home to Volvo AB.
Austrian Economy Minister Margarete Schramboeck said “it’s hard to say” what Trump will end up deciding and urged EU governments to stay united.
“It’s very important that all countries stand together and do understand that it’s not about: it’s my car industry or it’s your car industry,” Schramboeck said. “It’s the European car industry. There is something at stake for a lot of employees in the whole of Europe.”
Malmstrom repeated the EU’s position that any decision by Trump to apply auto duties against Europe would shatter the trans-Atlantic trade truce.
“While we are talking, we should not impose any tariffs on each other,” she said.
Last month, Malmstrom unveiled a blueprint for a free-trade deal with the US that would cut tariffs on a wide range of industrial goods including cars. It is that proposal that EU trade ministers are discussing in the Romanian capital before a formal decision is made in the coming weeks.
The removal of trans-Atlantic tariffs on industrial goods would expand US exports to the EU by 13% and the bloc’s shipments to the American market by 10%, according to the commission. The average tariff on non-farm products is 4.2% in the EU and 3.1% in the US, the commission said.
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