US President Donald Trump is expected to announce this week that he is delaying a decision on whether to slap tariffs on vehicles and auto parts imported from the EU, likely for another six months, EU officials said.
“We have a solid indication from the administration that there will not be tariffs on us this week,” one EU official said on Monday.
The Trump administration has a tomorrow deadline to decide whether to impose threatened “Section 232” national security tariffs of as much as 25 percent on imported vehicles and parts under a Cold War-era trade law.
Photo: AP
US Secretary of Commerce Wilbur Ross, whose agency is overseeing an investigation into the effect of auto imports on US national security, on Nov. 3 said that the US might not need such tariffs after holding “good conversations” with automakers in the EU, Japan and South Korea.
Trump in May delayed a decision on the tariffs by six months, and another delay would cause automakers across the globe to breathe a sigh of relief.
EU officials said while a further six-month delay was likely, Trump’s actions were unpredictable and he would likely keep the threat of auto tariffs hanging over them as the US and EU pursue trade negotiations in the coming year.
“We believe that nothing will happen for now, but the threat of tariffs will be left there as leverage,” a European diplomat said.
US Trade Representative Robert Lighthizer and European Commissioner for Trade Cecilia Malmstrom have spoken more often in the past few weeks, and the tone had become more “positive,” the diplomat added.
Politico on Monday reported that Trump would announce a six-month delay in the EU auto tariff decision, citing an unnamed person familiar with the decision.
The European diplomat said there was no specific timetable for an in-person meeting between Lighthizer and Malmstrom or any concrete sign the US and Europe were nearing an agreement on trade issues.
The US wants to include increased US agricultural access to Europe in the talks.
However, EU member states have resisted that, only authorizing negotiations over industrial goods tariffs and regulatory issues.
When the US and Japan reached a partial trade deal in September involving agriculture and industrial goods, Japanese Prime Minister Shinzo Abe said he won a firm commitment from Trump not to impose national security tariffs on Japanese vehicles.
A South Korean auto industry source also expected Trump to delay the decision on the Section 232 tariffs, and use it as leverage during negotiations with the EU.
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