The European Union has agreed to a partial truce with the United States in a dispute over metal tariffs imposed by former president Donald Trump and to start discussions on global overcapacity and China’s “trade-distorting” policies.
The European Commission, which oversees EU trade policy, said on Monday it would suspend a planned hike of retaliatory tariffs for up to six months. These would have added US products from lipstick to sports shoes and doubled to 50 per cent duties on US bourbon whiskey, motorbikes and motor boats on June 1.
In a joint statement, Brussels and Washington said that, as allies, they could promote high standards, address shared concerns “and hold countries like China that support trade-distorting policies to account”. The discussions would seek solutions to the issue of global steel and aluminium overcapacity.
A month ahead of a visit to Brussels by US President Joe Biden, one EU diplomat said it would have been “terrible optics” if the bloc had raised tariffs on Harley Davidson bikes and products of other US firms.
Bernd Lange, head of the trade committee of the European Parliament, said the US needed to come to a EU-US summit with a “tangible commitment to reciprocate the EU gesture. Otherwise, tariff hikes would be justified.
The US will maintain its tariffs of 25 per cent on steel and 10 per cent on aluminium, which also apply to imports from China, India, Norway, Russia, Switzerland and Turkey.
