The Heads of State or Government of the European Union were briefed by the European Commission on the negotiations underway with the Americans during the European Summit on 26 June. According to several Commission sources, these are progressing. But an agreement has yet to be reached. On the same day, the US administration submitted to the Commission a document containing counter-proposals for further negotiations. However, the President of the Commission, Ursula von der Leyen, did not share the details with the leaders, according to several of them.
On the same day in any case, the White House, through its Press Secretary Karoline Leavitt, opened the door to an extension of the 9 July deadline. “But it’s up to the President to make that decision”, she added.
Quickly protect strategic sectors. For the moment, some Member States are getting impatient. France and Germany, for example, are concerned that a return to cross-border tariffs of less than 10% is unattainable. In this context, they want to explore the possibility of agreements in particularly exposed sectors such as the automotive, aerospace, semiconductor and pharmaceutical industries.
“I told my colleagues: ‘Let’s find a solution quickly, please’. I was referring in particular to certain industries that we have in Germany; the chemical industry, pharmaceuticals, mechanical engineering, [those of] steel and aluminium, the automotive industry, are all currently subject to tariffs that are so high that it is really putting companies at risk”, said the German Chancellor, Friedrich Merz, after the meeting.
His French counterpart, Emmanuel Macron, believes that there is “clearly a way” to reduce customs duties in these sectors. In his view, however, symmetrical rebalancing measures should be considered. In the end, “the levy on our manufacturers will give rise to the same levy on their manufacturers, because otherwise we would be naive or weak, or both”, explained the French President. And to cite the example of the 10% tariff currently applied to European products.
This statement is a far cry from the European Commission’s approach over recent months, which is not to tax US products symmetrically, but rather to target sectors that will hurt the United States while protecting European businesses.
Taking the time to get it right. While all the members of the European Council are anxious to see a solution, not everyone shares the French and German visions, according to a European diplomat, who said that, among the Member States, an overwhelming majority supports the Commission’s work towards a horizontal agreement.
“We are going to remain calm, we are going to negotiate and we hope to find an agreement”, said Belgian Prime Minister Bart De Wever.
His Luxembourg counterpart, Luc Frieden, who also supports the Commission, allowed himself an even greater dose of hope: “I think that the positive atmosphere we had in The Hague on security issues will, I hope, have a positive impact on the trade negotiations”. However, he admitted that “a new strategy is needed”.
Mercosur. This subject was not strictly on the agenda of the European summit, but was inevitable as the Commission plans to publish its proposal for the conclusion and signature of the agreement in the EU Council by Monday 30 June. After years of waiting, the German Chancellor reiterated his willingness to move quickly, and several Member States in the Liberal camp, as well as Spain, are joining him without hesitation.
France, for its part, maintains its line of opposition: the agreement is not satisfactory as it stands. To be acceptable, it would require an additional instrument comprising safeguard measures on “certain key agricultural products”, explained Mr Macron. (Original version in French by Léa Marchal with the editorial staff)