The European Union has followed the proven rules of global trade while it is trying to negotiate with the Trump administration to avoid painful prices on cars, pharmaceuticals and almost everything else.
The problem? President Trump is tearing up this rules book.
Friday morning, Trump announced in a social article of truth that he would recommend a 50% rate on European imports on June 1, claiming that commercial barriers, taxes, corporate penalties and other block policies had contributed to a commercial imbalance with the United States which was “completely unacceptable”.
“The European Union, which was formed with the main aim of taking advantage of the United States on trade, was very difficult to manage,” wrote Mr. Trump, adding: “Our discussions with them are not going!”
The surprise announcement comes after months of back and forth talks between the two huge savings that made Mr. Trump was limited.
European officials have approached negotiations as if they reasoned with an ally. But they met a Trump administration which considers that less as a chance for two geopolitical friends to seek a mutually beneficial solution – and rather as an opportunity to put pressure on a commercial rival to make concessions.
Trump imposed a round after the tariff cycle on the economic block of 27 nations and the world since its entry into office in January. He struck sectors such as steel and aluminum and cars with specific prices, while threatening to place higher samples from most American business partners. But in April, he announced that he interrupted this last category for a period of 90 days when the countries negotiated agreements.
The president’s announcement, if implemented, would not only hit the European Union with the prices on the sides before the end of this planned negotiation period, but also double the expected rate of the block.
In the talks, the block decision-makers suggested what they presented as a win-win solutions, including a plan to remove prices on zero industrial products and buy more American gas.
But the American negotiators looked for unidirectional offers, diplomats, officials and people familiar with the negotiations said, and did the White House officials suggest that it was not a donation and a catch. It’s just a catch.
“I believe that the president thinks that the EU’s proposals have not been of the same quality as we have seen from our other important business partners,” said Scott Bessent, the US Treasury on Fox News on Friday.
The prices are only one arena in which the United States has revised its relationship with Europe, which has been classified since generations among the nearest American allies.
Trump took verbal shots at Volodymyr Zelensky, the president of Ukraine, while withdrawing full support from Ukraine in his war against Russia. He insisted that America will no longer rely the European security bill and even suggested that this may not happen to the support of NATO members who, according to him, are not sufficient for their own defense.
While Mr. Trump goes up the basic contours of the American-Europe relationship, he puts pressure on the block to bring several changes linked to the trade that EU officials do not even want to consider.
Trump wants European nations to be used for their value added tax system, a key consumption tax – which, according to the negotiators, is not on the table. Administration officials suggested that Europe will want to change food sanitation standards so that it imports more American beef – another non -beginner.
Administration officials also came after Europe to regulate digital services and social media companies – also policies that European officials did not want to reconsider.
But unlike small economies like Great Britain, which has already concluded an agreement with the Trump administration, the European Union has a sufficiently important commercial relationship with the United States that its officials thought they had a certain lever effect.
Commercial relations in Europe with the United States are the most important in the world, by certain measures. Nearly $ 5 billion in goods and services cross the Atlantic every day between the two partners, by EU estimates. And while Europe sells America more goods it does not buy – the commercial deficit of goods was around 180 billion dollars in 2023 – it bought more American services than it sells.
Maros Sefcovic, the EU trade commissioner, and his colleagues went several times to Washington to speak with Howard Lungick, Commerce Secretary, and Jamieson Greer, the US trade representative.
Sefcovic spoke to his counterparts in the United States on Friday after Mr. Trump’s threat, and posted on social networks thereafter that “EU-US trade is unrivaled and must be guided by mutual respect, not threats. We are ready to defend our interests. ”
In addition to making offers, European officials have also prepared two waves of countermeasures that would hit American products in Europe with higher rates if no agreement is concluded. The second set of counter -tariffs – which would target 95 billion euros in American goods which could go from Bourbon to soy – is still being refined.
Neither the offers of Europe nor its threats were warmly welcomed by the administration.
“There are countries that are impossible, such as the European Union,” said Lutnick during an Axios event earlier this week.
Analysts from Washington and Brussels said on Friday that they considered the 50% rate as a negotiation tactic. But the way the quarrel could resolve was not clear.
“There is a serious daylight between the EU expectations on what it can achieve in these discussions and what the US administration is willing to give,” said Jörn Fleck, Senior Director of Europe Center of the Atlantic Council in Washington.
If 50% of the prices should really take effect and last, they would crush the block. The European Union is currently facing 10% prices through exports, like other nations. After the expiration of the 90-day break in July, the block expected to face prices of 20%, on the basis of what the United States had previously announced.
European officials have hoped that prices would rather return to something like what had prevailed before this year, a reduction compared to the current rate of 10%. But this is not what Mr. Trump’s team currently offers.
“The president will decide if they have made us an offer worthy of modifying their pricing conditions,” said Lunick earlier this week. “If they have not made us an offer that changes it, the president will write to them a letter saying:” Dear country A, we deeply appreciate the business with you. Here is your rate rate. “”
And, he said, “there will be no floor less than 10.”
Melissa Eddy Berlin contributed reports and Ana Swanson from Washington.
