EU officials upbeat on ‘win-win’ trade agreement with US

German markets were reassured and upbeat EU officials returning from Washington after crucial trade talks spoke of a “win-win” deal for the EU and the US and a “de-escalation” of their conflicted relationship.

The joint declaration from the meeting on Wednesday between president Donald Trump and the president of the European Commission Jean-Claude Juncker hailed a “new phase in the relationship between the United States and the European Union – a phase of close friendship, of strong trade relations . . . a $1 trillion bilateral trade relationship.”

Somewhat un-Trumplike, the declaration went on: “If we team up, we can make our planet a better, more secure, and more prosperous place.”

Against the background of what a spokesman insisted were low expectations for the visit, an elated Mr Juncker said: “I had an intention to make a deal today, and we made a deal.”

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The two leaders said they had agreed to work together towards eliminating all tariffs, trade barriers and subsidies related to non-auto industrial goods. They also said they would work together to reform the World Trade Organisation and reduce trading costs and regulatory barriers across the Atlantic.

The agreement, they said, promised no major trade war and no escalation in the tariff war that the US kicked off on steel and aluminium. The latter would remain in place, along with the EU’s initial retaliatory measures, but would be reassessed by both sides. Specifically no new car tariffs, to the relief of Berlin.

Mr Trump has been threatening to impose tariffs of up to 25 per cent on imports of cars and parts from around the world, with the EU one of his main targets.

But Paris was lukewarm on the talks and wanted “clarification”of a reference by Mr Juncker to “a close dialogue on standards in order to ease trade, reduce bureaucratic obstacles and slash costs”. French finance minister Bruno Le Maire warned against any dilution of food and environmental standards, insisting that agriculture be kept out of the deal.

That is the case, a senior EU official said, despite comments by US trade secretary Wilbur Ross to the contrary. "Mr Ross can say what he wishes," he said, pointing to the text of the statement read out by Mr Trump.

Soya beans

There was Washington spin too on what the US president said were promises from Mr Juncker that Europe would buy large quantities of US soya beans and liquefied natural gas. The EU insisted that these were merely aspirations on the basis of favourable market conditions and current prices for both products. The markets would determine if they were able to do so.

“The European Union wants to import more liquefied natural gas from the United States to diversify its energy supply,” the statement said. An EU official was adamant that any purchases of soya beans containing GMOs would be strictly in conformity with EU rules and involve only specifically approved varieties. “There never can be a trade-off involving environmental standards or safety of our food.”

Political observers said there was perhaps less to the agreement than the hype suggested, but that it represented a significant, symbolic rebalancing in tone of the Trump treatment of European allies following his abrasive tour of Europe. On the same day he postponed the planned autumn visit of Vladimir Putin to Washington.

How long the new empathy with the EU will last is impossible to predict.