The European Commission is gearing up for intensified trade negotiations with the United States, as officials express doubts about the extent of concessions that can be achieved. EU official Matthias Jørgensen indicated to MEPs that the U.S. may maintain tariffs on EU goods, suggesting that total removal may not be feasible. The current tariffs imposed by the Trump administration include 25% on EU steel and aluminum, 25% on EU cars, and 10% on all EU imports.
According to a European diplomat, it is clear from discussions that reducing U.S. tariffs below 10% will be challenging, with Polish economic undersecretary Michal Baranowski predicting difficulties within the council regarding this threshold. France and Germany are expected to be the least satisfied with any outcome, while Hungary, Ireland, and Italy may have less concern about the negotiations.
After a period of stagnation, some movement in trade discussions is now apparent. EU Trade Commissioner Maroš Šefčovič reported that both expert and political engagement has increased, having had a "constructive" call with U.S. Trade Secretary Howard Lutnick. Šefčovič expressed hope for a meeting with U.S. Trade Representative Jamieson Greer in the near future.
The EU is prepared to discuss facilitating imports of U.S. liquefied natural gas, AI technology, and soybeans, while also proposing zero-to-zero tariffs on all industrial goods. Jørgensen emphasized that the EU is willing to be flexible but will not negotiate on non-tariff barriers, including EU legislation.
If the EU cannot restore the previous trade balance, a €95 billion list of retaliatory measures introduced by the Commission could be enacted. Sefcovic warned that allowing the current imbalance to persist indefinitely is not an option, as U.S. tariffs now cover 70% of EU exports to the U.S.
Lobbying efforts are underway concerning which U.S. products should be included in the retaliation list, with particular focus from France, Italy, and Spain seeking to keep Bourbon Whiskey off the list to protect their wine and spirits from further U.S. retaliation. Additionally, the aircraft industry remains a concern, as the U.S. launched an investigation after the EU included Boeing in its retaliation package, putting Airbus in potential jeopardy.
As negotiations progress, the commitment to finding a balanced resolution will be crucial for both sides of the Atlantic.
