WASHINGTON: In what the EU chief called a “major concession,” US President Donald Trump agreed to refrain from imposing car tariffs while the two sides launch negotiations to cut other trade barriers, easing the threat of a transatlantic trade war. After a meeting at the White House, Trump and European Commission President Jean-Claude Juncker said the talks would also seek to “resolve” US tariffs on steel and aluminium and Europe’s retaliatory duties — marking a step back from Trump’s signature import protections for American metals producers.
The breakthrough came as the bitter trade dispute between the United States and China appeared to claim a major casualty, with China not approving US chipmaker
Trump said Europe agreed to increase purchases of US liquefied natural gas and lower trade barriers to American soybeans, aiding US farmers and the energy sector.
“Soybeans is a big deal. And the European Union is going to start, almost immediately, to buy a lot of soybeans,” Trump told reporters after the meeting.
Trump later tweeted that work on documents was “moving along quickly,” adding that the meeting with Juncker had “great warmth.”
“A breakthrough has been quickly made that nobody thought possible!” Trump wrote, marking a turnaround from July 15, when he called the 28-nation European Union a “foe” on trade.
Juncker said the two sides agreed that as long as they were negotiating on trade, they would hold off on further tariffs, including potential US tariffs on cars and auto parts.
He later told reporters that was a “major concession” on Trump’s part and that he expected the US president to follow through on it.
US import tariffs of 25 per cent on steel and 10 per cent on aluminium imposed in March will remain in place during the talks, but Juncker added: “It is the first time that the Americans agreed to reassess the measure that they have taken in the steel and aluminium sector.”
European governments and EU officials hailed the Trump-Juncker agreement as a major success.
“Breakthrough achieved that can avoid trade war and save millions of jobs! Great for global economy,” tweeted German Chancellor Angela Merkel’s economy minister, Peter Altmaier.
DEAL BUOYS STOCKS: The late-afternoon news that the meeting had eased transatlantic trade tensions fed a powerful late rally on Wall Street.
US stocks shot to their highs of the day, with the benchmark S&P 500 Index rising by the most in nearly two months to close the day within 1 per cent of an all-time high.
The dollar fell, led by a surge in the euro, which has been pressured by the deteriorating trade relations with the EU’s largest trading partner.
US Treasury prices also eased and the 10-year note’s yield ended the day at a one-month high near 2.98 per cent.
Steel-makers’ shares fell, with United States Steel falling more than 5 per cent in extended trading, and AK Steel Holdings sliding 2 per cent. — Reuters
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