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Original title: Does the EU Impose Additional Tariffs on US $ 4 Billion on US Goods and Bring the US Back to the Negotiating Table on the Offensive?
At the 10th local time, the European Commission (hereinafter the “European Commission”) officially imposed tariffs on US exports to Europe worth US $ 4 billion, imposing tariffs of 15% or 25% on the manufacture of aircraft and other agricultural products. In accordance with the US tariffs imposed on Airbus and other products exported to the US, the EU has not issued a 100% retaliatory tariff penalty.
European Commission Vice President and Trade Commissioner Valdis Dombrovskis said that although the EU will impose tariffs on US products, it is also willing to negotiate an agreement with the United States. If the US lifts US $ 7.5 billion tariffs on EU exports to US taxes in 2019, the EU will abolish its tariffs.
German Minister of Economy and EnergyAltPeter Altmaier also responded to this suggestion. He said he hopes the United States will be able to return to international affairs next year, restart trade negotiations and resolve accumulated trade disputes between the United States and Europe in recent years.
Wang Hongyu, a researcher at the National (Beijing) Institute for Opening the University of International Business and Economics, and a professor at the School of International Relations at the University of International Business and Economics, said in an interview with a China Business News reporter that the EU approach is reasonable and legal, and is essentially a kind of peer-to-peer trade retaliation. On this basis, releasing the EU’s goodwill is an “offensive as well as defensive” approach, which may bring the United States back to the negotiating table.
He believes that there is a great possibility of reconciliation between the United States and Europe in the future, and the strategic closeness between the United States and Europe will be enhanced. However, the United States may not back down on specific issues, and there are still many essential differences between the United States and Europe.
Is it a good time to impose tariffs on the United States?
Last month, the European Union obtained permission from the World Trade Organization to impose tariffs on US products worth $ 4 billion. The EU can counter products made by US aircraft, or it can choose to counter other US products or services exported to Europe.
In the latest list of taxes published by the European Commission, there are two types of goods. The first category is the five Boeing products, which will be subject to tariffs of 15%, which will cause a new blow to Boeing. Europe is an important market for Boeing. Affected by the new corona pneumonia epidemic and the crash of the 737 Max, Boeing’s stock price has fallen nearly 45% this year.
The second category are products not manufactured by aircraft, which are mainly distributed in agriculture and non-high manufacturing, these goods will be subject to tariffs of 25%. In the agricultural sector, these products include wheat, cereals, cotton, nuts, cheese, sweet potatoes, and spirits. In the industrial field, these products include gymnastic equipment, suitcases, plastic products, automatic loaders, etc.
US President Trump has stated that if the EU imposes tariffs on the United States, the United States will intensify its counterattack. The United States obtained permission from the World Trade Organization to impose tariffs on Europe in 2019, but so far, the United States has not adopted the highest tariff level.
The United States currently imposes a 15% tariff on Airbus aircraft and a 25% tariff on a number of European exports to the United States, including French wine, Scotch whiskey and Spanish olives. Trump said the US government can raise the import tax on these goods to 100%, which will prevent them from entering the US market.
When the EU announced the list of tariffs imposed on the United States, some analysis by the EU said that this is not necessarily a good time to impose tariffs on the United States. Democratic candidate Biden has won more than 270 electoral votes in the US presidential elections. If he enters the White House in January next year, trade relations between the US and Europe are likely to be restored.
Holger Schmieding, chief economist at Berenberg Bank in Germany, said that if Biden becomes president of the United States, the 16-year Airbus-Boeing trade dispute between the United States and Europe could be resolved. Even across the entire trade zone, the United States and Europe can try to reach a free trade agreement.Before 2017, the United States and Europe had been discussing how to achieveAtlanticTrade and Investment Association (TTIP).
Frank Sportolari, the top representative of the American Chamber of Commerce in Germany, said chamber members believe that if Biden is elected president, the United States and Europe will no longer clash in the commercial arena, and the two sides can revoke the mutual tariff decree.
David O’Sullivan served as ambassador of the European Union to the United States from 2014 to 2019. He believes that the alliance between the United States and Europe fell to a low point during the Trump presidency, and is expected to repair the alliance on next year.
expertTo weighSpecific trade friction between the United States and Europe will continue
In terms of foreign and trade policy, the Democratic Party is more open than the Republican Party. Before the US presidential election, Biden promised to take the United States back to multilateral affairs, such as returning to the World Health Organization and restarting the Paris Climate Agreement. Brovskis said that WTO reform, trade and climate change are key areas for future cooperation between the United States and Europe.
If the United States intends to strengthen trade ties with the European Union, will it develop in the direction that the European Union hopes? What will be the difficulties for the United States and Europe in future negotiations on aviation manufacturing subsidies?
Optimistic views As the aforementioned EU business and political academics have said, trade relations between the US and the EU will recover and the 16-year dispute of litigation will come to an end.
But another analysis believes that the EU should not be “too optimistic”. Schmiding said that even if the Democratic candidate enters the White House in the future, his trade policy may not be fundamentally reversed. In recent years, the environment of the world trading system has generally changed.
Schmiding believes that Biden can adopt a trade policy that focuses more on protecting existing employment opportunities in the United States, rather than opening new opportunities through free trade.
Wang Hongyu told CBN reporters that the United States may not back down on many trade issues. The United States and Europe have conducted TTIP negotiations, but were unsuccessful, showing that the differences between the United States and Europe still exist. Currently, there are also disagreements in the United States on whether to maintain a close transatlantic partnership. From a general perspective, the bilateral economic and trade relations between the United States and Europe will go further, but specific trade frictions may continue.
Brovskis said that trade and technology have always been the biggest friction between the United States and Europe. If you want to solve the problems in the above two areas, the United States and Europe should work together to establish a trade and technology committee to cooperate on new digital technologies and services, and maintain consistency in regulations and standards.
He believes that the United States and Europe must urgently resolve disputes in the field of civil aviation. The European Union has done everything possible in this regard. If the United States removes tariffs on Europe, both parties will have a win-win option.
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