Latest news with #AntiCoercionInstrument
CNBC
27-07-2025
- Business
- CNBC
Global week ahead: Crunch time for trade talks as Trump's deadline nears
I think most would agree that the news cycle has been relentless for most of 2025, but certain stories do seem a little "Groundhog Day" at the moment. Earlier this month, I wrote about the conundrum facing the newsroom over how to approach President Donald Trump's then-trade talk deadline of July 9. Now, at the end of the month, we find ourselves in a similar position, but this time the date we are all watching is August 1. Why? Once again, it's another deadline for countries across the globe to try and agree a trade truce with the United States, with the European Union in particular focus this time round. Debate in the newsroom resurfaces … when is a deadline not a deadline? The week has become even trickier to predict, with talks between the U.S. and China now taking center stage in Stockholm on Monday and Tuesday — potentially further complicating the picture for Europe. A U.S. trade agreement with the European Union has seemed tantalizingly close, with CNBC's Silvia Amaro reporting that a 15% baseline tariff rate is the base-case scenario, according to an EU diplomat. These reports drove stock markets across Europe and the U.S. higher last week. On Friday, however, Trump told reporters there was only a "50-50 chance" of a deal. As CNBC's Holly Ellyatt explains, the EU is keeping its so-called "trade bazooka" — or Anti Coercion Instrument — warm in case an agreement is not reached by the August deadline. The corporate world is crying out for an agreement, piling pressure on the European Union to put an end to the uncertainty. Puma, VW, Michelin and other corporates across Europe have downgraded their outlooks citing the impact of tariffs and the ongoing pressure the restrictions are putting on these businesses. This week, all eyes will be on another raft of earnings from Europe, including banking giants UBS, Santander and Standard Chartered, drinks firm Heineken, pharma giant AstraZeneca and energy major Shell to name a few. On the data front, GDP growth rates for France, Spain, Germany and Italy will be released on Wednesday, providing insight into the wider impact of the market uncertainty. Last week, the tricky economic conditions saw the European Central Bank opt for a hawkish hold of the benchmark rate at 2%, with President Christine Lagarde saying the ECB is "in a good place to hold and watch how risks develop over the next few months." And so Friday August 1st will be a crucial date for market participants and corporates (and the newsroom)… until it isn't.
Malay Mail
22-07-2025
- Business
- Malay Mail
Inside the EU's Anti-Coercion Instrument as bloc prepares sweeping response to Trump's tariff threat
BRUSSELS, July 23 — A growing number of European Union member states, including Germany, are considering using wide-ranging 'anti-coercion' measures targeting US services if the EU cannot reach a trade deal with US President Donald Trump, EU diplomats say. Here are details of the bloc's Anti-Coercion Instrument, which took effect at the end of 2023 and hitherto has never been used, as it is seen by many as a 'nuclear option' that is ideally meant as a deterrent. Possible measures The ACI allows the 27-nation EU to retaliate against third countries that put economic pressure on member countries to change their policies, and offers far wider scope for action than just counter-tariffs on US exports. The ACI has a 10-point list of possible measures against Trump's threat of a 30 per cent tariff on EU imports by August 1. As well as tariffs on goods, the ACI tools include curbs on imports or exports of goods such as through quotas or licences. For public tenders in the bloc, worth some €2 trillion (RM9.7 trillion) per year, there are two possibilities. Bids, such as for construction or defence procurement, could be excluded if US goods or services make up more than 50 per cent of the potential contract. Alternatively, a penalty score adjustment could be attached to US bids. The ACI could also lead to measures to affect services in which the US has a trade surplus with the EU, including from digital services providers Amazon, Microsoft, Netflix or Uber. Measures could also curb foreign direct investment from the United States, which is the world's largest investor in the EU. Further measures could include restrictions on protection of intellectual property rights, on access to financial services markets and on the ability to sell chemicals or food in the EU. The EU is supposed to select measures that are likely to be most effective to stop the coercive behaviour of a third country and potentially to repair injury. How does the EU invoke the ACI? The ACI was proposed in 2021 as a response to EU member criticism that the first Trump administration and China had used trade as a political tool. China had targeted Lithuania, according to Lithuanian officials, after it allowed Taiwan to set up a de facto embassy in Vilnius. The law gives the European Commission up to four months to examine possible cases of coercion. If it finds a foreign country's measures constitute coercion, it puts this to EU members, which have another eight to 10 weeks to confirm the finding. To confirm, a qualified majority of EU members is required — a higher bar to hurdle than for applying retaliatory tariffs. The Commission would normally then consult with the foreign country in an effort to stop the coercion. If that fails, then within six months it can adopt EU response measures, again subject to a vote by EU members. These should enter force within three months. The whole process could take a year, but could be sped up. — Reuters
Reuters
21-07-2025
- Business
- Reuters
EU's 'nuclear option' of moves against Trump tariff threat
BRUSSELS, July 21 (Reuters) - A growing number of European Union member states, including Germany, are considering using wide-ranging "anti-coercion" measures targeting U.S. services if the EU cannot reach a trade deal with U.S. President Donald Trump, EU diplomats say. Here are details of the bloc's Anti-Coercion Instrument, which took effect at the end of 2023 and hitherto has never been used, as it is seen by many as a "nuclear option" that is ideally meant as a deterrent. The ACI allows the 27-nation EU to retaliate against third countries that put economic pressure on member countries to change their policies, and offers far wider scope for action than just counter-tariffs on U.S. exports. The ACI has a 10-point list of possible measures against Trump's threat of a 30% tariff on EU imports by August 1. As well as tariffs on goods, the ACI tools include curbs on imports or exports of goods such as through quotas or licences. For public tenders in the bloc, worth some 2 trillion euros ($2.3 trillion) per year, there are two possibilities. Bids, such as for construction or defence procurement, could be excluded if U.S. goods or services make up more than 50% of the potential contract. Alternatively, a penalty score adjustment could be attached to U.S. bids. The ACI could also lead to measures to affect services in which the U.S. has a trade surplus with the EU, including from digital services providers Amazon, Microsoft, Netflix or Uber. Measures could also curb foreign direct investment from the United States, which is the world's largest investor in the EU. Further measures could include restrictions on protection of intellectual property rights, on access to financial services markets and on the ability to sell chemicals or food in the EU. The EU is supposed to select measures that are likely to be most effective to stop the coercive behaviour of a third country and potentially to repair injury. The ACI was proposed in 2021 as a response to EU member criticism that the first Trump administration and China had used trade as a political tool. China had targeted Lithuania, according to Lithuanian officials, after it allowed Taiwan to set up a de facto embassy in Vilnius. The law gives the European Commission up to four months to examine possible cases of coercion. If it finds a foreign country's measures constitute coercion, it puts this to EU members, which have another eight to 10 weeks to confirm the finding. To confirm, a qualified majority of EU members is required - a higher bar to hurdle than for applying retaliatory tariffs. The Commission would normally then consult with the foreign country in an effort to stop the coercion. If that fails, then within six months it can adopt EU response measures, again subject to a vote by EU members. These should enter force within three months. The whole process could take a year, but could be sped up. ($1 = 0.8578 euros)
