The United States and the European Union are close to an agreement aimed at preventing a doubling of import duties on American jeans, engines and whisky. That reports news agency Bloomberg on the basis of insiders. Possibly the Biden administration announces that a ceasefire has been agreed on Monday for the trade conflict
As a retaliation for steel taxes introduced by Donald Trump in 2018, the EU is charging an additional 25% tax on a wide range of US products that can be added to the come in. These penalties would double on 1 June, which threatens imported jeans from Levis and Harley-Davidsons to become 50 percent more expensive.
Steel and aluminium
The US and the EU have now promised to discuss overcapacity in the steel market. In the meantime, Brussels waives the increase in import duties, writes Bloomberg. American and European negotiators would not yet have reached the stage of abolishing import duties.
The trade conflict arose when Trump imported import duties of 25% on steel and 10% on aluminium from virtually all countries in the world in spring 2018. He motivated that step with concerns about national security. The EU struck back with similar measures.
Joe Bidens trade envoy, Katherine Tai, said before a Senate Commission this week that Trumps import duties were needed. “They shaken our economy, but were necessary to address the global overcapacity caused mainly, but not exclusively, by China.”
The American Chamber of Commerce pointed to the negative consequences of the trade conflict on Friday. It would only hurt American companies and their employees extra. For example, exports of American spirits to the EU have fallen by 40% since the introduction of levies. The influential lobby group argues that the problem of Chinese exporters dumping cheap steel on the US market has already been solved by measures other than generic import duties.