The EU expects an imminent agreement on tariffs with Donald Trump. After the initial anxiety for the extension of the negotiation period until August 1, beyond the deadline that had been placed on July 9, in Brussels they are convinced that “in the next few days” a principle will be announced in accordance with the White House that avoids the taxes to about 70% of commercial transactions with the US. The US president said Tuesday that he would announce the tariffs to the EU “in about two days.” So the new day marked in red on the calendar is this Thursday.
Why the mess of dates?
When Donald Trump unleashed his tariff war in the so -called 'Liberation Day' on April 2, he announced the entry of mass tariffs to the rest of the world. Including the EU. But then he decided to give a truce and suspend the specific part for each country of the new levies (and leave 10% universal). And the 27 acted accordingly suspending 90 days the entry into force of the countermeasures he had prepared in response as a gesture of good faith before the negotiation.
The deadline to negotiate was between April 9 and July 9, but Trump decided on Monday to expand that negotiation period until August 1, which will be the date on which the tariffs imposed by the rest of the countries impose on force.
The EU wanted at all times to close the agreement as soon as possible to give certainty to industries and markets. And the new Trump date took them with their foot changed at a time when the negotiations had intensified.
“The faster we achieve an agreement, the better, because that would eliminate the uncertainty that surrounds this issue of tariff EU tariffs.
An agreement to continue negotiating
The dialectic is different in the case of the EU, which speaks of a “principle of agreement” with the White House in which the Commissioner of Commerce, Maros Sefcovic, is working, which this Wednesday had a new call with Trump's commercial advisor, Jamieson Greer, waiting for the US response to the last proposal sent by the EU. “My understanding is that we are not going to receive a letter,” replied the spokesman for community trade, Olof Gill, referring to the pressure that the US president is doing to the rest of the countries with new tariffs as of August 1.
The EU considers that “in the next few days” it will be announced “the joint declaration of the principle of agreement”, according to SEFCOVIC this Wednesday in the European Parliament. That text would be a base on which to continue negotiating the detail, sector by sector: “It would provide a framework on which we could continue building, defining the exact parameters of the subsequent agreement.” “I see it as a foundational framework that paves the way for a future EU-EEUU commercial agreement in full rule,” said the commissioner.
“We are looking for a clear frame, from which we can continue to build,” said the president of the European Commission, Ursula von der Leyen, who spoke by phone with Trump on Sunday.
The EU assumes more tariffs
What is taken for granted in the EU is that a part of the tariffs that Trump imposed have come to stay and that the universal tax of 10% will remain, although it is less than 20% that Trump announced in early April. The rate could reach 17% for agricultural products, according to the country.
Brussels negotiating efforts have focused in recent days on achieving exemptions that 'save' the German industry, wine and manufacturing commercial airplanes, especially thinking about Airbus. In fact, the German chancellor, Friedrich Merz, squeezed in the final stretch of the negotiation so that an agreement was closed as soon as possible, with the aim of giving certainty to the companies and the markets, and that the details be outlined later.
And the rebalancing?
The great unknown for now is how the EU will respond to the increase in tariffs that it takes for granted, since from the community point of view the situation was more or less balanced and could have been resolved with some fringes, such as the purchase of more gas from the US or zero tariffs by zero to industrial products, as well as a reduction in the case of vehicles. But the introduction of a general lien clashes with what the EU had considered fair.
“We have addressed this task with a laser approach to balance the US demands with our own priorities and ensure that our regulatory autonomy remains intact. But allow me to be clear: although we remain committed to the achievement of a satisfactory agreement, we must recognize that there will continue to be a certain degree of rebalancing,” said Sefcovic.
And there will be a new discussion within the EU, which has been preparing the possible response to the entry into force of Trump tariffs for months and has a package of up to 95,000 million euros prepared. “We are ready for all scenarios,” said Von der Leyen this Wednesday.
Threats that are fulfilled?
There are many people who no longer trust Donald Trump's word, who considers that he never finished fulfilling his threats related to tariffs. And that's why they have baptized him as a taco, that is, Trump Always Chickens Out “Trump always rays,” a nickname that the US president learned a few weeks ago during an appearance before the press in the White House.
And the truth is that tariffs have not ceased to be a roller coaster: ads and rectifications, limit dates and extensions, one figure and then another.
Moreover, this Monday night, when asked if the letters sent on Monday to 14 countries were an “final offer”, Trump replied: “Yes, but they call with a different offer and I like it, we will accept it.” And on the new date of August 1, he said it was “firm, but not 100% firm.”
Following that pattern, the taco cooked on May 2. That day, the columnist of Financial Times Robert Armstrong wrote: “The recent economic rebound has a lot to do with the fact that the markets have concluded that the US administration does not have a very high threshold of tolerance to economic pain and markets, and that it will quickly turn back when tariffs begin to cause ravages. This has been called the taco theory: Trump Always Chickens Out “Trump always cowns.”
The concept, hidden in the middle of an analysis of the economic situation, began to grow until it exploded in the White House last week, when the CNBC journalist, Megan Cassella, takes the microphone and asks Trump. “What do I go back? What cunning myself? I had never heard that,” Trump replies enraged, “and you come with a question as unpleasant as that … it's called negotiating. Do not say that again. It is a very unpleasant question. It is one of the most unpleasant they have asked me.”
Two days after that response, Trump announced that he doubled the tariffs to steel and aluminum, from 25% to 50%. But it is also true that, after announcing exorbitant tariffs – living on the judicial process – on April 2, on the so -called “Liberation Day”, he finally left them at 10%; And that after announcing 145% to China, it reduced it to 30% while negotiating, something similar to what happened with Canada and Mexico.
Trump, in addition, has announced a 50% tariff to copper, in the line of what was applied to steel and aluminum.
And now, when the negotiations that started in April had to conclude on July 9 – “90 agreements in 90 days” -, it turns out that this Monday announced that the deadline was extended until August 1.
¿Trump Always Chickens Out? Does Trump always strain? At the moment, what it does is generate a lot of confusion.
Is Spain in trouble?
And part of that uncertainty for Trump's fluctuations has to do with Spain after Trump threatened to specifically punish the country with more tariffs for Pedro Sánchez's refusal to raise military spending to 5% of GDP, as the US imposed on the rest of NATO allies. In Brussels they have not issued any signal that allows us to think that this situation has hindered negotiation or that it will come true.
In any case, Trump cannot attack Spain exclusively and the response would be from the entire EU, which is the one that has trade competences.
The Government has been relatively quiet so far with the commercial war on the argument that there is no huge dependency of the US. Spain imports more from the US of what it exports and its ratio represents around 1.3% of GDP, well below what it represents for other economies, such as Germany or Italy.
