The first non -binding political agreement between the European Union and the US can be concluded before July 8. This is the term set by Donald Trump to conclude a contract or face 50 % “mutual” tariffs.
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As Politico found out from four anonymous EU diplomats, Brussels strives to ensure an American commitment to “in advance” customs relief at the time of the conclusion of the contract. This would resemble a contract already concluded by Great Britain with Washington, which offered customs exemptions for car and steel export, while talks on a comprehensive contract will be continued. A number of EU countries said that no agreement would be possible without such a relief.
The EU Commissioner for Trade Maros Sefcovic went to Washington to the decisive round of conversations On Thursday with a US representative for trade in Jamieson Greer. On Friday, he is to inform EU countries about their results.
The EU is seeking to relieve customs duties in a trade agreement with the USA
As Politico informs, It is expected that in this potentially decisive round of Sefcovic it will signal that the EU still hopes to lower the tariffwhich Trump imposed on most US trading partners in April. However, under certain conditions, the block will say that it can accept 10 percent.
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EU diplomats, with whom Politico talked, also admitted that The EU presses rates for key sectors, such as pharmaceuticals, semiconductors, alcohol and commercial aircraft. The German Chancellor sought such reductions, although EU diplomats, with whom Politico talked, doubt the possibility of negotiating this condition.
As the talks are still open and there are no specific findings, as Politico reports – the European Union considers four different scenarios in its relations with the USA. The worst solution is to completely break the conversations. At that time, however, the basic 10 % duties would be raised to 50 percent. What's more, additional duties on products such as pharmaceuticals and semiconductors would probably be applied.
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Another variant assumes continuing the talks in the summer months, and at the same time the current duties would remain in force. The most favorable scenario, about which Politico was talked about by EU diplomats, assumes the completion of negotiations in the case of RAM and cooperation in the field of counteracting the industrial power of China. It is also allowed that the current conversations will not bring a binding contract, and the discussion will continue without indicating a specific limit.
