EU claims ‘positive momentum’ in trade talks with US

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The US and EU have discussed a potential deal to cut and ultimately scrap tariffs on car imports as Brussels scrambles to avoid becoming embroiled in Donald Trump’s escalating global trade war.

EU officials insisted there was “positive momentum” towards a compromise between the two sides following talks in Washington this week seeking to “avoid unnecessary pain” and avert tariffs threatened by the US president.

“The priority, which was highlighted several times in our conversation, was to work on cars — how to lower the tariffs, eventually even eliminate them,” Europe’s trade commissioner Maroš Šefčovič told reporters on Thursday.

“They’re very open to discuss everything which concerns lowering the tariffs, because we are probably the most open economy in the world,” he added. “Our number one priority is to avoid this period of pain.”

Since taking office Trump has sought to revamp the US’s trading relationship with the world. He has hit Chinese goods with an additional 10 per cent levy and plans to impose a 25 per cent tariff on steel and aluminium imports from next month.

He also plans to introduce “reciprocal” tariffs on a country-by country basis, which could hit Europe hard, and is weighing sector-focused levies on industries including automotive, pharma and semiconductors.

Trump has singled out the EU for particular criticism, lashing out at the scale of the trade deficit and what he sees as discriminatory treatment for US imports, especially in the automotive sector. The EU charges a 10 per cent levy on cars compared with the 2.5 per cent US level.

“The EU has been very unfair to us,” he said this week. “They don’t take our cars, they don’t take our farmed products, they don’t take almost anything . . . And we’re going to have to straighten that out.”

Šefčovič on Wednesday held four hours of talks with US commerce secretary Howard Lutnick, US trade representative nominee Jamieson Greer and National Economic Council director Kevin Hassett.

The EU trade chief asked Washington to delay any new levies while a deal was thrashed out, a request he said was “positively perceived”.

But the Slovak made clear that any deal on automotive tariffs would have to account for the 25 per cent rate levied by the US on light truck imports, including pick-ups. “The US is protecting the pick-up . . . so I think that if you are looking for reciprocity, it must work for both,” he said.

Brussels has already promised “firm and proportionate” retaliation if Trump imposes tariffs on steel and aluminium on March 12 as planned. But Šefčovič was reluctant to expand on how the EU response would play out.

He said the delegations had discussed narrowing the trade deficit “relatively quickly” by increasing EU imports of liquefied natural gas and soyabeans. “We need more LNG . . . because we are phasing out the Russian gas. So this is clearly . . . the area where we can do a lot together.”

The commission declined to comment on another central US demand of accepting more shellfish. The EU has spent three years reviewing whether three US states — Maine, Connecticut and Rhode Island — should be allowed to join the only other two — Massachusetts and Washington — able to export oysters and mussels to the bloc.

The White House said last month that it would use tariffs to address the imbalance in the shellfish trade. In 2023 the US imported shellfish worth $274mn from the EU but exported only $38mn of the product.