13:28 GMT01 March 2021
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    Relations between the allies have been marred since last year when Washington imposed new steel and aluminium tariffs. The EU responded with retaliation measures, which resulted in a further exchange of threats, including the US plan to impose a 25% levy on foreign cars. The decision on it is to be announced in mid-November.

    Outgoing head of the EU executive branch, the European Commission, Jean-Claude Juncker has told the German outlet Sueddeutsche Zeitung that US President Donald Trump will not impose new tariffs on EU-made cars in the upcoming week.

    “Trump will ruffle a bit, but there will not be any automobile tariffs. He won’t do it. You’re talking to a fully informed man”, he said.

    His spokeswoman Mina Andreeva declined to tell Bloomberg how her boss could be so sure about the US plans, resorting to a comment: “The president and his team are in constant contact with our US counterparts -as it should be”.

    Donald Trump has threatened to introduce levies on car exports for months and cited alleged threats to the US national security. The tariffs would hit Japan and the EU with German manufacturers suffering from the biggest losses. However, in May, Washington suspended the promised tariffs for six months with the deadline set for mid-November.

    Glimpse of Hope on the Shores of the Atlantic

    While the transatlantic partners are currently negotiating a trade agreement, EU Trade Commissioner Cecilia Malmstrom voiced a less sure but still optimistic opinion.

    “We do not know what the Americans - or the American president - will decide next week. We do note that there seem to be very few people defending the idea of tariffs in the car sector”, Malmstrom told a European Parliament committee, as cited by Bloomberg.

    Before that, US Commerce Secretary Wilbur Ross signalled that there could be no need for new punitive measures following “good conversations” with automakers in the EU.

    “Our hope is that the negotiations we’ve been having with individual companies about their capital investment plans will bear enough fruit that it may not be necessary to put the 232 fully into effect, may not even be necessary to put it partly in effect”, Ross told Bloomberg Television, meaning the probe under Section 232 of a 1962 trade law.

    EU vs US in Trade Spat

    The trade spat between the US and the EU has been unfolding for more than a year, since the Trump administration introduced special tariffs on steel and aluminium imports from the EU and other countries, including Washington’s ally Japan. The EU responded with symmetrical import taxes on US products.

    Besides this, in mid-October, Washington issued punitive tariffs on other products such as Parmesan, olive oil and butter as well as aircraft from the EU as retaliation for EU subsidies on its aerospace manufacturer Airbus, deemed illegal by the World Trade Organisation. The WTO had given the US authorities green light to do so, while the EU also touted countermeasures.

    Nevertheless, Juncker describes his relationship with Trump as good. If it came down to it, he could talk to the US president. "My impression is that Trump is better able to bow to someone who says what he thinks than to those bangers who bow to the American flag three times for no reason”.


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    car tariffs, trade, Jean-Claude Juncker, Donald Trump, Cecilia Malmstrom, Germany, EU, United States
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