Political Awareness

Note: Political Awareness’s published communication is never authorized by any candidate or their committees.

The United States and the European Union are close to finalizing a deal outline before the new Aug. 1 deadline. With talks extended past the previous July 9 deadline, President Donald Trump claims talks are progressing nicely.

“They treated us very badly until recently, and now they’re treating us very nicely. It’s like a different world, actually,” Trump said.

E.U. Trade Chief Maros Sefcovic says good progress has been made on a framework trade agreement, with a deal just around the corner. However, not all think agreement is likely. Export-driven countries like Germany want a deal as fast as possible, while other nations that are less dependent on the U.S., including France, continue to push back.

The Italian Economy Minister Giancarlo Giorgetti described talks as “very complicated” and speculates the successful conclusion of talks by Aug. 1.

Negotiations will likely still include the U.S.’s 10% tariff on European goods. Europe hopes to close this deal soon to avoid the 25% and 50% tariffs on its automotive and steel sectors. This is much more punishing on countries like Germany, Italy, and Ireland, which export more to the U.S.

Germany is the top exporter of cars and car parts to the U.S. Berlin continues to back a proposal by German automotive companies to counter the 25% tariff. If implemented, European car makers that produce in the U.S. can export one car tariff-free for every car they make in the U.S. and export to Europe. This would heavily favor manufacturers like BMW and Mercedes-Benz, who maintain production facilities in the U.S.

Other manufacturers like Volkswagen and any French automobiles won’t benefit at all, as they don’t export from the U.S. Negotiations over the car sector were inconclusive in the July 7 negotiations.

The tariff negotiations test the E.U.’s unity. Some want a quicker deal to get things back on track, while others push for a better deal. A commission spokesman for the E.U. said that they are in contact with all members at all levels and are aiming for an “outcome which is in the best interest of our citizens.”

A deal could come in a few days, like Sefcovic said, or could come just before August 1st. The Trump administration has been claiming that the tariffs (on all countries, not just the E.U.) have been a great revenue source. The Department of the Treasury said Washington has taken in $100 billion so far and could collect $200 billion more by the end of the year.

Others are critical of Trump’s “trade war,” with Democrat Governor Maura Healey of Massachusetts saying his war has failed and is “hurting our business.” Many concluded deals have favored the U.S., and Europe expects nothing different.