(May 15): Top trade officials from the European Union’s (EU) member states expressed increased confidence that they can reach an agreement to dial back the US’s tariff hikes after the Trump administration struck a tentative deal with the UK and agreed to significantly de-escalate its conflict with China.
Ahead of a gathering in Brussels on Thursday, the officials welcomed the US’ recent moves to dial back its trade war while indicating they want to ensure than any deal is in the trading bloc’s interests.
“We are seeing some elements of optimism because we are seeing elements of de-escalation on the American side,” said Michal Baranowski, the undersecretary of state at the Ministry of Economic Development and Technology of Poland. “Negotiations with the EU are speeding up.”
The growing optimism comes as the US approach elsewhere has made it increasingly clear that US President Donald Trump is willing to back away from the punitive tariffs he has threatened to impose on major trading partners if they are willing to make concessions to the US. That’s easing some of the economic risks posed by the rapidly evolving US trade policy, fuelling a rebound in markets that tumbled last month on mounting fears of a recession.
Maros Sefcovic, the EU commissioner for trade and economic security, said he had another call with US Commerce Secretary Howard Lutnick on Wednesday, with further meetings between the two planned.
Trump has continued to maintain a combative stance towards the EU, saying this week that it is “in many ways nastier than China”, and the trading bloc has been preparing to impose another round of counter-tariffs against the US if talks fail. The US has temporarily delayed some of its levies on the EU to allow for negotiations.
“Trade conflicts are harmful; they slow down the exchange of goods, they slow down economic growth, and in the end there are no winners,” German Economy Minister Katherina Reiche said ahead of the meeting, adding that she hopes a “reasonable solution” can be found. “We are negotiating from a position of economic power, which must be used carefully.”
The US and China agreed to temporarily lower tariffs on each other’s goods after progress in negotiations, significantly ratcheting down the trade tensions between the world’s two largest economies. That followed a pact between the US and the UK that Trump said he hopes would be the first of many, though the details of that agreement have yet to be fully worked out and the EU may demand deeper concessions.
The Swedish minister for development cooperation and foreign trade, Benjamin Dousa, said that “if the UK-US deal is what Europe gets, then the US can expect countermeasures from our side”, he said. “We will not be happy with that kind of deal.”