The outlines of a trade agreement between the European Union and the United States are slowly taking shape. According to diplomats, the EU would agree to a basic tariff of 10%, with exemptions for specific sectors such as pharmaceuticals, semiconductors, alcohol and commercial aircraft. The EU also wants the U.S. to commit in advance to lowering tariffs, as it did with the United Kingdom, which has already secured a reduction in tariffs on car and steel exports while negotiations on other sectors continue. Everything would be set out in a framework agreement, with the details to be clarified later. The European Commission, which is leading the negotiations, wants to aim for a tariff of less than 10%, a level it is only willing to accept under certain conditions.
Initially, it aimed for a 0% tariff that both sides would accept. On top of that, it also wants to negotiate the American import duties of 25% on cars and 50% on steel and aluminium. The latter date back to the first term of U.S. President Donald Trump.
The stakes are high in any case. A complete failure of the negotiations would result in the U.S. imposing additional, so-called reciprocal customs duties of up to 50% on products such as pharmaceuticals and semiconductors, on top of their basic tariff of 10%. However, diplomats believe that a deal is looking likely and think that the 9 July deadline set by Trump could be extended if necessary.
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