Speaking to reporters in The Hague, Dutch Prime Minister Dick Schoof backed the EU’s strategy in trade talks and said the EU was likely to see this latest announcement as part of the negotiations.
“We have seen before that tariffs can go up and down in talks with the US,” he said.
The White House paused most of the punishing tariffs Trump announced in early April against nearly every country in the world after investors furiously sold off US assets including government bonds and the US dollar. He left in place a 10 per cent baseline tax on most imports, and later reduced his massive 145 per cent tax on Chinese goods to 30 per cent.
“My base case is that they are able to reach an agreement, but I am most nervous about negotiations with European Union,” said Nathan Sheets, global chief economist at Citigroup in New York.
A 50 per cent levy on EU imports could raise consumer prices on everything from German cars to Italian olive oil.
EU’s total exports to the United States last year totaled about 500 billion euros (US$566 billion), led by Germany (161 billion euros), Ireland (72 billion euros) and Italy (65 billion euros). Pharmaceuticals, cars and auto parts, chemicals and aircraft were among the largest exports, according to EU data.
