EU to canvass leaders at summit on resolving US tariff conflict

(Reuters)

BRUSSELS, June 26 – European Union leaders are to tell the European Commission on Thursday if they want a quick trade deal with the United States at the cost of Washington getting better terms, or to escalate the fight in hope of something better.

A quick deal seems to be the preferred option for most, officials and diplomats said, as the EU can then seek to address the unfavourable bias with some rebalancing measures of its own.

The Commission, which negotiates trade agreements on behalf of the EU, will ask leaders of the EU’s 27 members meeting in Brussels how they want to respond to President Donald Trump’s July 9 deadline for a deal, now less than two weeks away.

The bloc has said it is striving for a mutually beneficial agreement, but as Washington looks set to stick to its 10% across-the board tariffs on most EU goods and threatening higher rates with prolonged talks, EU diplomats said a growing number of EU countries were now favouring a quick resolution.

“It is …in everyone’s interest that the trade conflict with the United States does not escalate further,” German Chancellor Friedrich Merz said on Tuesday in parliament.

“I know that the European Commission is negotiating with great caution in this regard, and it has our full support. I hope that we will reach a solution with the United States by the beginning of July,” Merz said.

The bloc is already facing U.S. import tariffs of 50% on its steel and aluminium, 25% for cars and car parts, along with a 10% tariff on most other EU goods, which Trump has threatened could rise to 50% without an agreement.

The United States’ only completed trade deal to date is with Britain, with the broad 10% tariff still in place. U.S. officials say it will not go lower for any trading partner.

Some 23 of the leaders will come to Brussels straight from the NATO summit in the Hague. Few will want to follow accord there with an economic war.