Trump, EU chief seek deal in transatlantic trade standoff
Trump again told reporters he felt the two sides had a 50-50 chance of a deal with the European Union. The bloc faces an across-the-board US levy of 30 percent unless it strikes a trade pact by Aug 1.
Washington warned Sunday there would be "no extensions" and Trump confirmed "the deals all start on August 1".
Von der Leyen's European Commission, negotiating on behalf of EU countries, is pushing hard for a deal to salvage a trading relationship worth an annual US$1.9 trillion in goods and services.
The EU chief said at the start of the talks at Trump's luxury golf resort in southwestern Turnberry that if they reached a deal "I think it would be the biggest deal each of us has ever" made.
According to an EU diplomat briefed ahead of the meeting, the contours of a deal are in place, but key issues still need settling.
"A political deal is on the table -- but it needs the sign-off from Trump, who wants to negotiate this down to the very last moment," the diplomat told AFP.
The proposal, they said, involves a baseline levy of around 15 percent on EU exports to the United States, the level secured by Japan, with carve-outs for critical sectors including aircraft and spirits, though not for wine.
Any deal will also need to be approved by EU member states, whose ambassadors, on a visit to Greenland, were updated by the commission Sunday morning. They would meet again after any accord.
According to the EU diplomat, the 27 countries broadly endorsed the deal as envisaged, while recalling their negotiating red lines.
Baseline 15 percent
The Trump-von der Leyen meeting was taking place in the president's luxury golf resort in Turnberry on Scotland's southwestern coast.
The 79-year-old Trump said Friday he hoped to strike "the biggest deal of them all" with the EU.
The EU is focused on getting a deal to avoid sweeping tariffs that would further harm its sluggish economy, while holding out retaliation as a last resort.
Under the proposal described to AFP, the EU would commit to ramp up purchases of US liquefied natural gas, along with other investment pledges.
Pharmaceuticals, a key export for Ireland, would also face a 15-percent levy, as would semi-conductors.
The EU also appears to have secured a compromise on steel that could allow a certain quota into the United States before tariffs would apply, the diplomat said.
But Trump said Sunday trade tariffs with the EU would not be lower than 15 percent.
Auto sector
The EU has been hit by multiple waves of tariffs since Trump reclaimed the White House. It is currently subject to a 25 percent levy on cars, 50 percent on steel and aluminium, and an across-the-board tariff of 10 percent, which Washington threatens to hike to 30 percent in a no-deal scenario.
It was unclear how the proposed deal would impact tariff levels on the auto industry, crucial for France and Germany. Carmakers are already reeling from the levies imposed so far.
While 15 percent would be much higher than pre-existing US tariffs on European goods, which average around 4.8 percent, it would mirror the status quo, with companies currently facing an additional flat rate of 10 percent.
Should talks fail, EU states have greenlit counter tariffs on US$109 billion of US goods including aircraft and cars to take effect in stages from Aug 7. Brussels is also drawing up a list of US services to potentially target.
Beyond that, countries including France say Brussels should not be afraid to deploy a so-called trade "bazooka", EU legislation designed to counter coercion that can involve restricting access to its market and public contracts.
But such a step would mark a major escalation with Washington.
Ratings dropping
Trump has embarked on a campaign to reshape US trade with the world, and has vowed to hit dozens of countries with punitive tariffs if they do not reach a pact with Washington by Aug 1.
US Commerce Secretary Howard Lutnick said Sunday the Aug 1 deadline was firm and there will be "no extensions, no more grace periods."
Polls suggest however the American public is unconvinced by the White House strategy, with a recent Gallup survey showing his approval rating at 37 percent, down 10 points from January.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Times
44 minutes ago
- Business Times
South Korea pitches Trump on shipyards for last-minute trade deal
[SEOUL] South Korea is pitching the US on a shipbuilding partnership as a key proposal to seal a last-minute agreement to avoid a 25 per cent tariff rate. While details remain unclear, Yonhap News reported that South Korea has proposed a multi-billion dollar project dubbed 'Make American Shipbuilding Great Again'. South Korea's Industry Ministry declined to comment. 'We confirmed the US side's strong interest in the shipbuilding sector and the two countries agreed to work together to develop mutually acceptable terms that include shipbuilding cooperation,' South Korea's presidential office said on Saturday (Jul 26). As countries across Asia clinched deals last week, Seoul's negotiators have been racing to stay engaged with their US counterparts as Washington shifted its focus to the European Union and China. The US and EU announced a pact on Sunday that will see the bloc face 15 per cent tariffs on most of its exports to the US, including automobiles. The latest agreement, which follows a Japan deal last week, adds to the pressure on Asia's fourth-largest economy to clinch a deal. South Korea, where negotiations have been slowed by internal political turmoil, is one of the biggest Asian economies to still be without a deal. Aside from China, other major exporters in the region that are in the thick of negotiations include India and Taiwan. South Korea's finance and foreign ministers are set to meet with their US counterparts this week in a last-minute bid to close the negotiations and the government in Seoul has said the two countries are committed to making a deal before US President Donald Trump's Aug 1 deadline. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Also on the table is increased access to South Korea's agricultural market, as well as a fund to invest in American projects similar to an agreement Japan struck. Under the deal, the two sides touted a US$550 billion fund as part of the agreement on the tariff rate dropping to 15 per cent. The South Korean talks are similarly focused on reaching a 15 per cent tariff rate, including for autos, and the recent proposals suggest a comparable structure. Putting agricultural imports on the table raises the stakes for South Korea's new government. Past efforts to open the country's beef market sparked nationwide protests and any shift on rice imports could face even stiffer resistance. Barring a deal, Bloomberg Economics estimates a 1.7 per cent hit to South Korea's gross domestic product, with market volatility and uncertainty threatening to push the GDP losses beyond that. Overseas shipments were equivalent to more than 40 per cent of South Korea's GDP last year. 'Japan's trade deal paints a positive backdrop but also sets a high bar for others,' Morgan Stanley economist Kathleen Oh said in a note last week. 'Korea and Taiwan may need to ramp up new investment schemes to increase agricultural and energy imports and expand market access, as seen in Japan's case.' BLOOMBERG
CNA
44 minutes ago
- CNA
Malaysia's economy projected to grow 4% to 4.8% this year, central bank says
KUALA LUMPUR :Malaysia's economy is projected to expand by 4 per cent to 4.8 per cent in 2025, down from a previous forecast of 4.5 per cent to 5.5 per cent, its central bank said on Monday, warning that trade and tariff uncertainties could affect global growth. Headline inflation is expected to average between 1.5 per cent and 2.3 per cent this year, Bank Negara Malaysia said in a statement. The central bank said the global economic growth outlook was affected by shifting trade policies and uncertainties surrounding tariffs. It said Malaysia's "updated growth projections account for various tariff scenarios, ranging from a continued elevation of tariffs to more favourable trade negotiation outcomes." Although Malaysia's economy remains on a "strong footing", the central bank said its growth projection remains subject to uncertainties surrounding the global economy. Malaysia is facing a 25 per cent tariff on its exports to the United States unless it can reach a deal with Washington by August 1. Malaysia's trade minister said several sticking points remained in the talks with the United States, particularly on non-trade barriers, but discussions were progressing well and were on track to meet the August deadline.
Straits Times
an hour ago
- Straits Times
Boeing emerges as a winner in Trump's trade wars
US President Donald Trump and President and CEO of Boeing Kelly Ortberg attending a roundtable discussion in Doha, Qatar, in May. WASHINGTON - There are typically not many winners in a trade war, but Boeing appears to be reaping some rewards from the one started by US President Donald Trump. The aerospace company has received a steady stream of new orders as part of trade deals between the United States and other countries. These sales could be a boon for Boeing as it emerges from years of bruising crises. They also allow Mr Trump to claim that his unconventional trade policies are helping American manufacturing. Orders for hundreds of Boeing jets have been announced in deals with Indonesia and Japan in Jult, as well as Bahrain, the United Arab Emirates, Saudi Arabia and Qatar earlier in 2025. 'Ever since his first term, his trade deals have generally involved these kinds of purchase agreements,' said Mr Bruce Hirsh, a trade policy expert at Capitol Counsel, a lobbying firm in Washington that has clients in the aerospace industry. 'Our trading partners know this, so they're looking for these kinds of big-ticket items that they can offer to purchase.' Some aviation analysts are sceptical that US trade negotiators had to twist arms to persuade countries to buy Boeing planes. Airlines, including those controlled by foreign governments, plan such expensive purchases carefully and over months, if not years. Moreover, airlines have few choices, since Boeing and Airbus of France are the only two suppliers of large commercial jets. Still, those experts said, it was not surprising that Mr Trump and his aides have made a point of highlighting new Boeing orders as part of their trade deals. The company employs tens of thousands of Americans and is one of the country's top exporters. Wall Street has also taken note of the announcement of new orders, and Boeing's share price has climbed steadily since early April, when Mr Trump announced steep new tariffs on many countries. Analysts note that the trade deal announcements could generate even more orders. That is because customers who have not placed orders may feel pressure to buy planes now or risk having to wait when they need them. Planes ordered today will typically be delivered years from now. Boeing, which declined to comment for this article, has seemed to welcome Mr Trump's interest in its business. Boeing chief executive Kelly Ortberg joined Mr Trump on a May visit to the Middle East, during which the Qatar deal was announced. 'If the president of the country says, 'Come with me and be certain that we sign something big that says there will be many jobs in the US', what will you do?' said Mr Adam Pilarski, president of Avitas, an aviation consulting firm. But Mr Pilarski and other experts cautioned that the orders might not be nearly as substantial as they seemed. The administration, other countries and Boeing have offered few details about the deals, suggesting that at least some are still subject to complex negotiations between the manufacturer and airlines. In July, for example, Mr Trump said Indonesia had agreed to buy 50 Boeing jets. Later, however, an Indonesian official said the deal was still being hashed out between Garuda, a state-owned airline, and Boeing. 'I suspect these orders are, as we used to joke at air shows, Mouthls – memoranda of understanding to have lunch,' said Mr Richard Aboulafia, a managing director at AeroDynamic Advisory, a consulting firm. 'The real hard work of contract negotiation and finance package negotiation takes place after the President's plane has left the country.' Even if the orders are confirmed with formal contracts, many probably would have been placed even without Mr Trump's intervention, experts said. In May, Qatar Airways, a large airline that operates many long-distance flights, placed an order for 150 of Boeing's wide-body planes. The announcement was notably thorough. 'They involved press conferences, shaking hands, everything but the proverbial kissing of the babies,' said Mr Courtney Miller, managing director of Visual Approach Analytics, an aviation consulting firm. That deal, he said, probably would have been placed anyway, even if the timing had been accelerated to align with Mr Trump's visit. While some orders may be the result of real political pressure, even then a lot can change by the time the planes are ready to be delivered. Boeing and Airbus each have thousands of planes on order, accounting for many years of production. In that time, airlines can back out of agreements, though they may have to forfeit deposits. Customers can also ask Boeing or Airbus to delay deliveries or reduce their orders. A manufacturer may be willing to make such changes, especially if doing so will allow it to sell those planes to another airline that is desperate for new jets. The tariffs Mr Trump has imposed may threaten the financial health of Boeing's suppliers, and the prospects of retaliation by US trading partners like the European Union could hurt the plane maker's sales. Last week, budget airline Ryanair said it would consider deferring deliveries of Boeing planes if European officials imposed tariffs on American planes. European leaders may take other steps that could hurt Boeing. If the trade deals that the US strikes with other countries give Boeing too big an advantage, Europe could try to entice other countries to order more planes from Airbus, experts said. 'If this game is going to be played, the question is, in the long term, who plays it better?' Mr Miller said. 'It has reopened a very old dynamic of aligning aircraft and airline economics with geopolitical favour.' NYTIMES
