
The European Union expects to find out on Monday Whether President Donald Trump the punishment of tariffs will impose America’s largest trading partner In a move, economists warned that companies and consumers would have an impact on both sides of the Atlantic.
In early April, Trump imposed an import tax of 20% on all EU products as part of a sentence Tariff Targeting countries with which the United States have A trade weight weight. Hours after the country -specific duties became effective, he put them in the queue of 10% for the quiet financial markets and the time for negotiations by July 9th.
Trump to express displeasure with the EU’s attitude to trade talks said that he would increase The tariff set For European exports to 50%, which could create everything – from French cheese and Italian leather goods to German electronics and Spanish pharmaceuticals – much more expensive in the USA
The EU Executive Commission, dealing with trading problems for the 27-member nations of the block, said its leaders hope to complete a deal with the Trump government. The EU said without one ready to retire With tariffs on hundreds of American products, from beef and car parts to beer and Boeing aircraft.
The US Finance Minister Scott Bessent told CNN’s “State of the Union” program on Sunday that “the EU was very slow to get to the table”, but these discussions are now making “very good progress”.
Here are important things about the trade between the United States and the European Union.
The US-EU trade is enormous
The European Commission describes trade between the USA and the EU as “the most important commercial relationship in the world”.
According to the EU statistics authority, the value of the EU-USA trade was EUR 1.7 trillion ($ 2 trillion) in 2024 or an average of 4.6 billion euros per day.
The largest US export to Europe was crude oil, followed by medicines, aircraft, automobiles as well as medical and diagnostic devices.
The largest exports in Europe to the USA were pharmaceuticals, cars, aircraft, chemicals, medical instruments as well as wine and spirits.
The EU sells more to the USA than the other way around
Trump has complained about the EU’s 198 billion billion dollar surgical surplus in Waren, which shows that Americans buy more things from European companies than the other way around.
However, American companies close some of the gap by exceeding the EU in terms of services such as cloud computing, travel books as well as legal and financial services.
The US service surplus took over the nation’s trade deficit with the EU to 50 billion euros ($ 59 billion), which corresponds to less than 3% of US EU trade.
What are the problems that share the two sides?
Before Trump returned to office, the United States and the EU stopped a generally cooperative trade relationship and low tariff levels on both sides. The US rate was 1.47% for European goods, while the EU achieved an average of 1.35% for American products.
But the White House used a much less friendly attitude The long -term US ally Since February. Together with the fluctuating tariff set for European goods, the Trump flooded, the EU was exposed to the 50% tariff of its administration for steel and aluminum as well as a tax of 25% for imported automobiles and parts.
Trump administration officers have addressed a number of problems that they would like to have addressed, including agricultural obstacles such as EU health regulations that contain bans for chlorine-washed and hormone beef.
Trump has also criticized the value creation taxes in Europe, which the EU countries charge for sale this year with 17% to 27%. However, many economists see VAT as commercial, since they apply for domestic goods and services as well as for imported services. Since the national governments determine taxes through legislation, the EU has announced that they are not on the table During the trade negotiations.
“In the thorny questions of regulations, consumer standards and taxes, the EU and its Member States cannot give much reason,” said Holger Schmieding, chief economist at Germany’s Berenberg Bank. “You can not change the way you operate the enormous internal market of the EU according to US requirements, which are often rooted in an incorrect understanding of how the EU works.”
“Consequence for many companies”
Economists and companies say that higher tariffs will mean higher prices for US consumers for imported goods. Importers must decide how much of the additional tax costs through lower profits and how much of customers should be passed on.
Mercedes-Benz dealers in the USA said they hold the line “to further” for 2025 model years. The German car manufacturer has a partial tariff sign because 35% of Mercedes-Benz vehicles in the USA are sold in Tuscaloosa, Alabama. However, the company expects the prices to be subjected to “significant increases” in the coming years.
Simon Hunt, CEO of the Italian wine and spirits producer Campari Group, told investment analysts that prices for some products could rise or remain the same depending on the competitive company. If competitors increase prices, the company could decide to keep its prices for Skyy Vodka or Aperol Aperitif to win market shares, said Hunt.
Trump has argued that foreign companies are more difficult to sell in the United States and is a way to promote a revival of American production. Many companies have rejected the idea or said it would take years to achieve positive economic advantages. However, some companies have proven to be ready Move some production States.
The luxury group LVMH based in France, whose brands belong to Tiffany & Co., Louis Vuitton, Christian Dior and Moet & Chandon, could bring production to the USA, said Bernaud Arnaud, CEO of Milliardär, Bernaud Arnault, at the company’s annual meeting in April.
Arnault, who took part in Trump’s inauguration, asked Europe to achieve a deal based on reciprocal concessions.
“If we end with high tariffs, we will be forced to increase our production based in the USA to avoid tariffs,” said Arnault. “And if Europe does not negotiate intelligently, this will result for many companies.
“Street could be rocky”
Some forecasts point out that the US economy would be more at risk if negotiations fail.
Without a deal, the EU would lose 0.3% of its gross domestic product and the GDP of the US GDP would drop by 0.7% if Trump imported goods from Europe with tariffs from 10% to 25%.
In view of the complexity of some topics, the two sides can only arrive a framework contract before the deadline on Wednesday. This would probably make a basic tariff of 10% and the car, steel and aluminum tariffs until details of a formal trade agreement have been ironed out.
The most likely result of the trade talks is that “the United States will agree to business in which it will take back the worst threats from” retaliation tariffs well over 10%”, said Schmieding. “The street to get there could be rocky.”
The United States, which offers exceptions to some goods, can smooth the way to a deal. The EU could offer some regulations to facilitate the white house as commercial barriers.
“While Trump could be able to sell such a result as a” profit “for him, the ultimate victims of his protectionism would of course be mainly the US consumers,” said Schmieding.