EU leaders urge restart of trade talks

European Union leaders on Wednesday urged President Trump to restart trade talks they say would help solve differences over tariffs while strengthening economic ties.

European Union leader Donald Tusk and Cecilia Malmstrom, the European commissioner for trade, are among the top officials appealing to Trump to not only exempt the EU from steep aluminum and steel tariffs but to relaunch transatlantic trade talks that could create a $5 trillion trading zone.

“[Trump’s] proposal to impose tariffs on European steel and aluminum is a bad sign for transatlantic relations,” Tusk said about Trump during remarks in Helsinki.

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“Let me be clear: Instead of risking a trade war, which he seems eager to wage, we should be aiming for greater cooperation,” Tusk said.

Tusk said relaunching the trade negotiations started in July 2013 during the Obama administration would provide a way to eliminate the frustration over barriers and tariffs between the 28-nation EU and the United States.

“We should go back to these talks now. Make trade, not war, Mr. President,” Tusk said.

Efforts to reconsider what was the Transatlantic Trade and Investment Partnership have so far fallen by the wayside since Trump took office.

That agreement was in the works over nearly four years under Obama, proposed to eliminate duties on 97 percent of all tariff lines, according to the Office of the U.S. Trade Representative. 

Instead, the Trump administration has focused on reworking the North American Free Trade Agreement (NAFTA) and the U.S. deal with South Korea.

On another front, EU leaders are questioning whether the tariffs of 25 percent on steel imports and 10 percent on aluminum imports are really over concerns about U.S. national security.

“We suspect that the U.S. move is effectively not based on security considerations but on an economic safeguard measure in disguise,” Malmstrom told the EU Parliament. 

The tariffs, which are expected to go into effect next week, have the potential to fracture the long-standing partnership.

Without an exemption, the EU is lining up possible retaliatory measures to protect their markets and punish U.S. exporters.

“Justifying tariffs on the basis of national security considerations risks undermining the multilateral trading system,” Malmstrom said.  

“Moreover, the European Union, friends and allies in NATO, is not a threat to the national security of the U.S.”

On Saturday, Malmstrom met with U.S. Trade Representative Robert Lighthizer and their Japanese counterpart to discuss the rising concerns about a global trade war.

The meeting, which was scheduled before Trump announced the tariffs, did little to quell Malmstrom’s worries.

“Unfortunately, I did not leave last Saturday’s meeting with sufficient clarity as regards the exclusions,” she said.

Malmstrom said EU officials are in intense talks with U.S. officials to avoid the tariffs.

“We do not want things to escalate,” she said.

“We do not share the view that trade wars are good and easy to win. On the contrary they are very bad for the world and they are very easy to lose.”

Trump has said he will use the threat of tariffs as leverage to push Mexico and Canada — both countries currently exempt from the new duties — to accelerate completion of NAFTA. Negotiators which started talks in August, recently wrapped up their seventh round of discussions with plans to continue trying to reach a deal. 

The president hasn’t suggested publicly that the tariffs could play a similar role in the U.S.-EU trading relationship.

Despite rising pressure from Republicans on Capitol Hill, Trump held firm on the tariffs offering up the possibility that other countries and certain products could be exempt from the hefty duties. 

The tariff order gives the president broad power to apply them to any country or product for a time frame at his discretion. 

But pro-trade lawmakers argue that the tariffs could impede the nation’s economic momentum and further damage our relationships with key allies.