Flags of the EU and the United States flutter next to the Ukrainian military hub in southeastern Poland on March 6, 2025.
Sergei is because | AFP | Getty Images
The U.S. and European Union have run out of time to reach a deal with trade tariffs – several key points may make the deal impossible, analysts say.
Negotiations have been slow since the United States and the European Union temporarily cut responsibilities to each other until July 9. If an agreement is reached then All countdown to import tariffs 50% of EU goods and group goods Extensive countermeasures The setting takes effect.
“We’re talking, but I don’t think they’re offering a fair deal yet,” U.S. President Donald Trump told reporters on Tuesday.
So, what keeps things in touch with each other worth 1.68 trillion euros (1.93 trillion US dollars) in 2024?
Large technical regulations
EU regulations on particularly large tech companies, experts marked the argument bone as a bone. The group faces regular criticism from the United States after imposing landmark rules on transparency, competition and temperance on technology giants.
“The Trump administration is proactive in using trade negotiations to force the EU to surrender and undermine the regulatory environment,” Alberto Rizzi, a policy researcher at the European Council on Foreign Relations, told CNBC.
“However, for Europeans, any intervention in the regulation of their domestic digital platform is unacceptable, which will run counter to their commitment to combat disinformation and hate speech.”
Philip Luck, director of economics programs at the Centre for Strategic and International Studies (CSIS), responded to the concern but said the EU could surrender some basis without undermining its principles.
However, the two sides “have not reached this level of dialogue.”
tax
Ritz said taxes are another major area of disagreement between the United States and the EU, noting that Trump believes tariffs are tariffs on unfair taxes imposed by European countries on U.S. companies and goods.
These include so-called VAT or VAT, which are levied at every stage of the supply chain because of the value of the product. Although very common around the world, the United States does not operate VAT, which Trump calls a trade barrier and also a reason for tariffs.
“But, in the exact same way as foreign goods, taxation is a pure domestic issue in the eyes of Europeans and should not be part of any trade discussion,” Richi said. “Taxes are the red line of the EU in trade discussion.”
A mismatched worldview
A broader issue between Washington and Brussels seems to be a lack of trust and consistency in the negotiations and their goals.
“There is only one incredible point of view, that is, Trump wants tariffs on the EU, and neither does the EU,” said Jacob Kirkegaard, a non-resident senior fellow at the Peterson Institute for International Economics.
CSIS’s luck elicited a similar tone, and philosophically, the United States and the European Union had very different views in negotiations.
He explained: “This (U.S.) government is giving a sense of concession to help us look at these negotiations from a perspective that they don’t see it as a traditional reciprocal trade dialogue, we’re giving something here, they give something.”
He said the EU had a more traditional view, as evidenced by its zero tariff proposal, which faced a counterattack from the White House.
Luck says that European politicians are “those who think they are the proud people who maintain equal status with the United States” and cannot make “continuous” concessions and do not feel that they should do so.
Will there be a transaction?
Luck says that the United States seems unlikely to accept a zero-set agreement, nor is it likely to accept an agreement between the two parties to reduce tariffs.
The EU can also secure deals like the UK, which is also doubtful agree Certain quotas and tariffs in certain key areas.
This is because, first, the group may not accept similar conditions as the UK, but also added: “The (US) government has a larger fundamental complaint about European policy.”
However, he did see a scenario where the EU may agree to lower tariffs, such as 10% currently in place, but that’s just because it has to be done.
Rizzi also suggested that “limited transactions to reduce or freeze tariffs in specific sectors” could occur. However, he noted that this does not mean a broad agreement to come to an upcoming one.
Others are even more pessimistic.
“I have a strong doubt that a deal will be concluded,” said Kirkegaard, who is also a senior fellow at Bruegel.
“I think the EU is irrelevant afterwards, and then we have to see if Trump does what he does to China: He retaliates again, maybe the EU retaliates again.”
He warned that downgrades and transactions are only possible when certain, very high, very high thresholds of economic pain are met.
