EU Foreign Affairs Council to Discuss US Trade Relations
The EU Foreign Affairs Council will meet today to discuss the future of the bloc’s trade relations with the US.
This meeting comes a week after the US agreed to repeal its 2018 steel and aluminum tariffs. The tariffs were part of former US President Donald Trump’s 2016 populist trade war to “punish” trade partners that Trump felt had hurt Americans. In tangible terms, this meant enacting a 25% steel tariff and a 10% aluminum tariff on EU imports.
The EU responded by increasing tariffs on US imports, such as whiskey and orange juice. By the end of the Trump administration, many economists believed all of Trump’s tariffs had hurt US consumers and businesses. The EU could not negotiate a change in the trade policies with the Trump administration, but the Biden administration has since successfully deescalated the trade war.
Although the EU and US have secured a deal, populism looms large in the US, and the EU knows this. The EU will likely craft policies to prevent it from being vulnerable to US tariffs in the future by increasing its domestic production of goods that it traditionally has relied on the US for.
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