EU reaches agreement with the US on trade tariffs
After the diplomatic fallout caused by President Trump’s trade tariffs, the European Union has now reached an agreement with the US to settle some of the key concerns.
Trade relations between the two have been under pressure for several years, with many experts fearing the tensions could spark a full-blown trade war.
In 2018, the US administration imposed tariffs on European products to the value of approximately $7.5 billion. The most controversial tariffs were steel and aluminum, but they also included up to 25% on products like Scotch whisky, French wine, and Italian cheese.
President Trump added taxes to EU steel and aluminum early on after claiming that these products were a threat to US national security, which resulted in counter-tariffs being imposed.
So far, this has been damaging to many American companies and has seriously hurt European producers. The aim of the tariffs was to create jobs in US steel mills. However, The Bureau of Labor Statistics shows that jobs in manufacturing only rose slightly during this time.
At the G20 summit in Rome, which was attended by President Joe Biden, the new agreement was announced by US trade representatives. Although Article 232 tariffs won’t be entirely removed at the moment, they will be adjusted.
The new deal, which is one of the first steps in resetting America’s relationship with Europe after the end of the Trump era, will mean a limited amount of European steel and aluminum will be allowed to be sold to the US without tariffs being applied.
Commerce Secretary Gina Raimondo said, “We were able to reach an agreement whereby the EU will drop their retaliatory tariffs (on American goods).” She added that the deal would make sure that “steel entering the U.S. via Europe is produced entirely in Europe.”
Earlier this year, the EU also took steps to improve relations by temporarily suspending some of the planned increases in its own retaliatory tariffs.