Latest news with #negotiations
Reuters
an hour ago
- Automotive
- Reuters
EU to advance retaliation on US goods as tariff hike looms
BRUSSELS, July 23 (Reuters) - The European Commission plans to submit counter-tariffs on 93 billion euros ($109 billion) of U.S. goods for approval to EU members, while its trade chief will hold talks with U.S. Commerce Secretary Howard Lutnick. The Commission said on Wednesday its primary focus was to achieve a negotiated outcome with the United States to avert 30% U.S. tariffs that U.S. President Donald Trump has said he will impose on the 27-nation bloc on August 1. European Trade Commissioner Maros Sefcovic will speak with Lutnick from Brussels on Wednesday afternoon, the Commission said, before Commission officials brief EU ambassadors on the state of play. The Commission said it would in parallel press on with potential countermeasures. It said it would merge its two sets of possible tariffs of 21 billion euros and 72 billion euros into a single list. It added it would submit this to EU members for approval. No countermeasures would enter force until August 7. So far the EU has not imposed any countermeasures, agreeing to, but then immediately suspending, the first set in April. Germany supports the EU readying countermeasures, a government representative said. The Commission may be buoyed by the initial deal struck between the United States and Japan. European shares climbed about 1%, led by automobile stocks, after Trump revived hopes for a trade deal with the EU following the U.S. agreement with Japan, which includes a 15% baseline rate. One stand-out feature of the deal was that the same rate applies to cars, against the current U.S. tariff of 25%, something the EU may want for its similar level of auto exports. In 2024, the U.S. imported more than $55 billion of vehicles and automotive parts from Japan. From the EU, the equivalent figure was 47.3 billion euros ($55.45 billion), with far fewer U.S. models sold into the EU or Japanese market. EU official say Washington has shown little sign of budging over car tariffs, but the Japan deal could point the way. The German government representative said U.S.-Japan relations were not comparable to those between the EU and the United States. UBS analysts said it was difficult to make assumptions for a potential EU-U.S. deal, but did say that unless the EU secured an agreement, Japanese automakers would be at an advantage. Volkswagen and BMW declined to comment. EU diplomats were reluctant to provide early comments, instead saying they were picking through details of the U.S.-Japan deal, such as that Japan would buy more rice from the United States, but would keep existing tariffs on agricultural products. Simon Evenett, professor of geopolitics and strategy at IMD Business School, said the 15% rate was lower than what Trump had recently threatened Japan with and it was notable that it appeared to apply to Japanese cars. "Whatever the Japanese got will become the minimum for the EU negotiating objectives," he said. ($1 = 0.8524 euros)
BBC News
3 hours ago
- Business
- BBC News
Faisal Islam: Trump's tough tariff tactics is getting results
Japan is a big deal for President Donald Trump's upheaval of world's trading system. On his own terms, it could now be said that his aggressive approach is yielding tangible from the off, the US side has been talking up the chances of a deal with Japan, but despite several delegations, the deal had been strangely elusive - until a narrow sense, this is a win for the Trump approach, especially if Japan becomes the domino that leads the rest of the world to come into now has the best deal, or rather, the least worst deal, of all the nations with major trade surpluses with the US. The general tariff of 15% to be charged on Japanese goods being imported to the US is higher than the UK's 10%, but the UK has no I've reported before, the fury of the Japanese negotiators during talks was noted among Washington DC diplomats accustomed to the nation's extreme politeness. Tokyo was playing hardball. The Japanese finance minister described the nation's $1.1 trillion holding of US Treasury bonds, the largest in the world, as a "card" that could be put on the was rumours about hedge funds in Japan selling of US bonds following Trump's "Liberation Day" tariffs announcement in April that sparked a wider sell-off, and bigger questions over the world's biggest economy and safe haven status of the US the reaching of a deal matters hugely, in and of itself, and as an example to other major economic blocs, including the European Union (EU).The deal comes on the day the Japanese host EU leaders in Tokyo. There had been some chatter about Japan, the EU and Canada coordinating their retaliation. This stops any such initiative. Some members of the EU will wonder why a similar deal cannot be struck, at the very moment that Germany and France up the ante on retaliation, perhaps against the US tech world awaits the details here, but it is clear that Japan has protected its agricultural imports, though will import more US rice. It is unclear what can change the lack of popularity of large American cars in the country, though Japanese private companies will be backed to invest half a trillion dollars in the US, in some has done this deal when it might have waited out to see how things develop and international markets react when Trump's tougher tariffs for a host of countries come into force on 1 August. The domestic political weakness of its Prime Minister may have been a factor, though other countries, including Indonesia and the Philippines have also done big picture though is a weary acceptance of the US levying what would have been a year ago unthinkable tariffs on its major allies, for fear of something worse. In Japan's case it was a 25% tariff threatened by Trump. Tariff revenue rising for the US Tariffs are now raising significant sums for the US Treasury, without retaliation against US exporters. At over $100bn so far this year, about 5% of US federal revenue is coming from tariffs, versus 2% more typically. The US Treasury Secretary Scott Bessent thinks that the annual tariff take will be $300bn. It is way off the amount raised by income taxes, but a notable amount. It is being taken without direct retaliation and without right now the market turmoil seen the story does not end here. Who is actually paying these tariffs? Ultimately US consumers will pay a large part in terms of the prices they pay for imported the past Bessent and others have suggested that a rising value of the US dollar would help mitigate the cost of imports for consumers. The opposite has happened. The dollar has slumped in the first half of this year, losing 10% of its value against a basket of world currencies. This will add to the cost of imports, in addition to the is a wider canvas here too. The governor of the Bank of England Andrew Bailey said this week that "the most crowded trade in the market at the moment is 'short dollar'". He added that established safe haven patterns in markets, especially the US dollar, were "essentially breaking down". There is a "reduction of exposure" to the dollar as companies and traders now take out trades or "hedges" designed to ensure they are protected against its decline," the governor I've discussed before, there is suspicion in the markets that this weaker dollar may actually have been part of the point of these interventions, designed to help boost, for example, American rust-belt manufacturers regain top of that, the US has also helped its great rival China to at least make a case to the rest of the world, that it can be a more stable trade this first stage of the great global trade war, Japan is an important win for the White House, which will push back against the suggestion that "Trump always chickens out" or TACO. While it could also translate into more apparent wins ahead of next week's deadlines, driving further market euphoria, the broader economic picture remains far murkier.
CNA
3 hours ago
- Business
- CNA
EU to submit countermeasures on US goods to avert looming tariffs
BRUSSELS: The European Commission plans to submit counter-tariffs on 93 billion euros (US$109 billion) of United States goods for approval to EU members, while its trade chief will hold talks with US Commerce Secretary Howard Lutnick. The Commission said on Wednesday (Jul 23) its primary focus was to achieve a negotiated outcome with the US to avert 30 per cent US tariffs that US President Donald Trump has said he will impose on the 27-nation bloc on Aug 1. European Trade Commissioner Maros Sefcovic will speak with Lutnick on Wednesday afternoon, the Commission said, before Commission officials brief EU ambassadors on the state of play. The Commission said it would in parallel press on with potential countermeasures. It said it would merge its two sets of possible tariffs of 21 billion euros and 72 billion euros into a single list. It added it would submit this to EU members for approval. No countermeasures would enter force until Aug 7. So far, the EU has not imposed any countermeasures, agreeing to, but then immediately suspending, the first set in April. The Commission may be buoyed by the initial deal struck between the US and Japan. European shares climbed more than 1 per cent on Wednesday, led by automobile stocks, after Trump revived hopes for a trade deal with the EU following the US agreement with Japan, which includes a 15 per cent baseline rate. EU diplomats were reluctant to provide early comments, instead saying they were picking through details of the US-Japan deal, such as that Japan would buy more rice from the US, but would keep existing tariffs on agricultural products. Simon Evenett, professor of geopolitics and strategy at IMD Business School, said the 15 per cent rate was lower than what Trump had recently threatened Japan with and it was notable that it appeared to apply to Japanese cars.
Bloomberg
3 hours ago
- Business
- Bloomberg
Bessent: EU Talks Going ‘Better Than They Had Been'
Treasury Secretary Scott Bessent says the US is 'making good progress' with the European Union on trade talks, but the EU has yet to present an innovative package similar to Japan. (Source: Bloomberg)
Japan Times
3 hours ago
- Business
- Japan Times
Japan and U.S. both claim win in surprise 11th-hour tariff deal
Japan and the United States reached a surprise trade deal on Tuesday in Washington after months of fruitless negotiations and some tense moments, with both sides taking victory laps and Japanese markets cheering the news. The United States is promoting it as the deal of the century. For Japan, it was a mission-accomplished moment. The agreement, the details of which are still being ironed out, includes a 15% "reciprocal" tariff on most Japanese goods and 12.5% on cars, with 50% tariffs on steel and aluminum remaining unchanged. Japan has agreed to buy more rice, improve market access and invest in a $550 billion fund that will support strategic industries and technologies in the United States. 'There has never been anything like it,' U.S. President Donald Trump wrote on Truth Social. The reciprocal tariff is 10 percentage points lower than the rate that had been scheduled to kick in on Aug. 1, while the auto tariff has been cut by half from 25%. The total for autos will now be 15%, including 2.5% duty on autos charged independent of Trump tariffs. 'I firmly believe we have achieved an agreement that protects what needs to be protected, while aligning with the national interests of both Japan and the United States,' Ryosei Akazawa, Japan's chief tariff negotiator, said Tuesday in Washington. Prime Minister Shigeru Ishiba noted that the 15% reciprocal tariff is the best rate achieved by a trade surplus country. The Nikkei 225 stock index rose 3.51% in trading Wednesday, with Toyota up 14.35% and Honda 11.15%. The yen traded steady in the ¥146 to the dollar range. Washington assured Tokyo that for strategically important goods, such as semiconductors and pharmaceutical products, tariffs for Japan will always match the best rate charged to other countries, Akazawa told reporters. He also said that Japan will increase American rice imports under the current minimum access framework, which has allowed roughly 770,000 metric tons of foreign rice to enter Japan annually tariff free. Japan and the United States will make efforts to strengthen supply chains through Japanese investment in the U.S., with a focus on semiconductors, pharmaceuticals, steel, shipbuilding, critical minerals, aerospace, energy, automobiles, artificial intelligence and quantum technology. Japanese government-affiliated financial institutions will provide up to $550 billion in equity investments, loans and loan guarantees, Akazawa said. He noted that defense spending targets were not included in the deal, and that Japan made no commitments to lower tariffs on U.S. products, as they are already very low. Finance Minister Katsunobu Kato said on Wednesday that the deal does not include any agreements on the yen-dollar exchange rate. 'I'm kind of surprised," said William Chou, deputy director of Hudson Institute's Japan Chair, in discussing the auto tariffs. The fact that Japan was able to cut the rate by 12.5 percentage points is a huge accomplishment, he said. Chou added that Japan has promised access and reforms that in the eyes of the U.S. administration "create a long-term pathway towards trade balance.' But Ryo Sahashi, a professor at the University of Tokyo's Institute for Advanced Studies on Asia, called the deal "an extremely limited win." 'What we've achieved is merely a reasonably decent result compared to the worst-case scenario,' he said. 'Japan has simply escaped the worst possible situation, nothing more.' The U.S. president announced the deal after a 70-minute meeting at the White House with Akazawa, who arrived in Washington on Monday for an eighth round of negotiations with the Trump administration. Prior to the meeting at the White House, Akazawa met with U.S. Commerce Secretary Howard Lutnick for more than two hours Monday evening and Treasury Secretary Scott Bessent for about 30 minutes Tuesday afternoon. 'It was a tense and high-stakes negotiation,' Akazawa said of his meeting with Trump. 'Both sides were fully serious and operating at the limit.' On X, Akazawa posted a photo in the White House with a hashtag that translates to #MissionComplete. People react as they read a newspaper special edition reporting on the U.S.-Japan tariff deal, in Tokyo on Wednesday. | REUTERS Ishiba — who has come under immense pressure to resign after the ruling coalition suffered a defeat in an Upper House election and lost its majority in the chamber — took credit Wednesday morning in Tokyo, saying the deal is a result of efforts made by his administration since February. 'This is precisely about prioritizing investment over tariffs,' Ishiba said. 'Since I proposed this idea to President Trump during the summit at the White House in February, I have consistently advocated for it and strongly pushed the U.S. side, and this agreement is the result of those efforts. 'I believe this will contribute to Japan and the United States working together to create jobs and promote high-quality manufacturing, thereby fulfilling various roles on the global stage moving forward,' he told reporters. News reports on Wednesday in Tokyo indicated Ishiba might resign by the end of August, though the prime minister denied this later in the day. 'Ironically, the Ishiba administration appears destined to be driven from office, with this tariff negotiation success potentially becoming its greatest — and final — achievement,' said Sahashi. But even if the leadership changes, Japan is likely to stick to the deal as part of Ishiba's legacy, said Hudson Institute's Chou. "I don't think a different leader would have necessarily been able to find a different path,' Chou said. The surprise breakthrough comes just ahead of an Aug. 1 deadline set by Trump in which the reciprocal rate for Japan was set to rise to 25%, up from the baseline 10%. Japan had previously eyed a meeting between Ishiba and Trump at the Group of Seven summit in June to reach a framework agreement, but auto tariffs had been a major sticking point. In the recent weeks leading up to Tuesday's agreement, Trump had expressed frustration with Japan and the pace of negotiations with the country, at one point threatening to take the reciprocal rate as high as 35%. 'I think both sides can claim that they got parts of what they wanted,' Chou said, while adding that the question now is whether Japan can carry out the pledges it has made. 'We'll have to see how that is carried out. I'm sure the Trump administration will also be paying very close attention."
