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Irish Times
18 hours ago
- Business
- Irish Times
Splits emerge between European governments over US tariff talks
Splits have emerged between European governments over talks to avert crippling tariffs on trade, as EU negotiators press United States president Donald Trump's administration for a deal in the next two weeks. Ireland, Germany, Italy and others are keen to land a quick deal with the Trump administration, while the French government is concerned about the European Union giving too many concessions. Mr Trump has threatened to put tariffs of 50 per cent on imports sold into the US from the EU, unless the two sides agree a trade deal by July 9th. Near-blanket tariffs of 10 per cent have been charged on EU goods since early April, with cars and steel subject to higher 25 per cent duties. Negotiators from the European Commission, the EU executive that leads on trade policy, have been putting more pressure on US counterparts, to get some form of tariff deal over the line before the July 9th deadline. READ MORE There is concern in Government that existing tariffs will become the new 'baseline', two sources said. Cementing tariffs at that rate would still have a significant economic impact, given the huge amount the Republic exports to the US. Officials in the Department of Finance are preparing an assessment of the impact to the Irish economy if tariffs of 10 per cent remain . European Commission president Ursula von der Leyen briefed EU leaders at a summit in Brussels late on Thursday about the progress of talks. It is understood she gauged how much national capitals would be ready to give in the tariff negotiations. [ Trump's on-off tariff announcements now the main threat to global growth Opens in new window ] Germany and Italy want the commission to make sure it agrees some type of deal, or the broad strokes of an agreement that heads off steeper tariffs, according to one source briefed on the discussions. It is understood the French government has been more hesitant and concerned about the level of concessions the EU would give to the Trump administration. French president Emmanuel Macron has said that if some US tariffs became permanent, the EU would have to consider putting similar duties on goods coming from the US. EU negotiators are expected to intensify efforts to hammer out a deal with their US counterparts in the next 12 days. Officials have largely accepted that any deal will not remove Mr Trump's 10 per cent ' liberation day ' tariffs, which apply to nearly all trade except pharmaceutical products and computer chips, which he has promised to hit with separate levies. EU trade commissioner Maroš Šefčovič said he is continuing to work towards a 'negotiated solution', after a phone call with US trade representative Jamieson Greer on Friday afternoon. Dublin and other capitals are eager to land at least a preliminary agreement, rather than extend the US tariff deadline beyond July 9th. Government sources said there is a lot of unease about the uncertainty the threat of looming tariffs was causing businesses. [ Alcohol health-warning labels to be delayed amid US-EU tariff dispute, says Harris Opens in new window ] The commission is preparing a package of retaliatory tariffs as leverage to levy on US trade if negotiations stall. It has proposed targeting Boeing and other aircraft manufacturers, the automobile industry and a host of other US products and sectors. The Government has asked the commission to reconsider putting counter tariffs on aircraft, medical devices, bourbon and agricultural products, to shield Ryanair, Irish whiskey distillers and the medtech sector from US crossfire in the event of a full-blown trade war. The EU's retaliatory package would only affect €25 billion worth of US trade, rather than €95 billion, if the EU was to remove from the tariff list every product member states want off, the commission recently told diplomats in a closed-door meeting.
Irish Times
20 hours ago
- Politics
- Irish Times
Thorny issues remain on EU leaders' table long after dinner plates are cleared
If you are not inside the room when the European Union's 27 leaders gather for a summit, there tends to be quite a bit of hanging around to be done. One question will always do the rounds among the waiting diplomats, officials and journalists: 'What time do you reckon they will wrap up?' The national leaders, European Commission president Ursula von der Leyen and former Portuguese prime minister António Costa, who is president of the European Council , got started just before noon on Thursday. The meeting of the council, which sets the big-picture policy direction of the EU, was pencilled in to last one day, though leaders were told to keep the early part of Friday free just in case things ran over. READ MORE The summit covered EU-US tariff negotiations , the wars in Gaza and Ukraine , proposed new sanctions on Russia , defence spending and migration policy. Details of what is going on in the leaders' room can be scant. There are a few short breaks where they leave to confer with advisers and diplomats. When the doors close, they will also keep officials updated with the odd WhatsApp message. Denmark's prime minister Mette Frederiksen speaks with European Commission president Ursula von der Leyen and Greek prime minister Kyriakos Mitsotakis during a meeting at the European Council in Brussels on Thursday. Photograph: John Thys/AFP via Getty Images At about 8pm on Thursday word got around that things might wrap up in an hour or so, which would have been remarkably quick. The talk was that rather than stopping to eat, the leaders might power through with a view to getting out early. It wasn't to be. A dinner of smoked cottage cheese dumplings, duck leg confit and strawberry cheesecake was brought in and the discussions went on for several more hours. Leaders like the fact that Costa has been limiting the summits to a single day since he took over as chair last December. But sometimes a row actually needs to be had. The EU has been deferring contentious matters in an effort to keep a loose consensus intact. Taking decisions can be tough when each head of state or government has a veto. For instance, Hungary's far-right prime minister Viktor Orban has consistently blocked EU efforts to aid Ukraine in its war with Russia. He has also held up talks between Brussels and Kyiv about Ukraine joining the EU in the future. A showdown between Orban and the other leaders is overdue. Dutch prime minister Dick Schoof (L) and Hungarian prime minister Viktor Orban at the start of the EU leaders' Summit in Brussels on Thursday. Photograph: Olivier Hoslet/EPA The EU did take a leap forward on defence policy in the spring, which Costa and Von der Leyen can hold up as a win. A summit in March approved a plan to significantly increase military spending to deter the future threat from Russia, given the question mark over continued US defence support. The union can move quickly when it wants to and a crisis does focus minds. The discussion on Gaza on Thursday was short. There was a sense that entrenched positions would not be moved. Germany, Austria, Italy and Hungary oppose efforts by Ireland, Spain and others to sanction Israel, so the EU remains stuck. [ Pro-Israel countries to block Irish efforts to sanction Israel at EU summit Opens in new window ] European Council president António Costa: leaders like the fact that Costa has been limiting the summits to a single day since he took over as chair last December. Photograph:Other internal reforms have been talked about for years without movement. Proposals to build up a European capital market have gone nowhere because countries don't want to change their national rules around issues such as insolvency. Those close to Costa say he will have no problem presiding over crunch summits that run on. The Portuguese politician likes open-ended strategic discussions, rather than having leaders squabbling over the wording of a joint communique issued after each summit. Leaders spent a record five days and four nights hammering out an agreement on the Nice Treaty reforms in 2000. There is no need to hole up Taoiseach Micheál Martin, French president Emmanuel Macron, German chancellor Friedrich Merz and the rest of them in Brussels for that long. However, the preference to get out of dodge after a single day means several thorny problems still remain on the EU leaders' table, long after the dinner plates have been cleared away.
Bloomberg
21 hours ago
- Business
- Bloomberg
Europe Eyes US Trade Agreement Ahead of Deadline
The European Union and the US believe they can agree a trade deal before July 9 , the deadline by which Washington is threatening to impose 50% tariffs on almost all EU products — which would trigger a series of countermeasures from the bloc. European Commission President Ursula von der Leyen privately told EU leaders yesterday that she was confident a deal could be reached before the deadline to avoid an economically damaging escalation, according to people familiar with the matter. During the meeting there was a shift in tone from leaders, with many saying they would accept some imbalances to avoid the situation getting worse.
The Guardian
a day ago
- Business
- The Guardian
EU retaliating to Trump drug tariffs would be ‘a bad idea', says industry
The European pharmaceutical industry has urged Brussels not to retaliate if Donald Trump brings in threatened tariffs on imported drugs, amid fears he could impose the levies as early as next week. The US president said last week that the sector-specific tariffs were coming 'very soon' and there is concern in Brussels that he could impose them imminently to give him further leverage ahead of his self-imposed 9 July deadline for trade deals with the EU and about 60 other countries. However, at a briefing in the Belgium capital on Thursday, the president of the European Federation of Pharmaceutical Industries and Associations said it would hurt everyone if the EU hit back with its own import duties. 'We're shipping a lot of exports out of the US into Europe,' Stefan Oelrich said. 'If we add tariffs to that, it's going to be negative for both sides. If we reciprocate on tariffs, it's just a bad idea. It's a bad concept.' The dynamics of the EU's negotiations with the US remain finely balanced. France and Germany both back a 'quick' UK-style deal and many member states, particularly the Baltic nations, are keen to build on warmer relations with Trump after his 'big win' at the Nato summit over increased defence spending, as they want to keep the president supporting Ukraine. With the clock ticking, speculation is mounting that the EU will do a thin deal on auto and steel – similar to the bilateral agreement brokered by Keir Starmer in May, which comes into force on Monday – but with no optimism in the pharma industry that it will be included. Oelrich said: 'There's no specific ask [of the US] other than … to the degree possible to limit trade barriers to zero, which would be the ideal case for us and/or something similar to zero. 'Tariffs will increase the cost of medicine and care. Tariffs will also create, ultimately, higher costs to patients.' After EU leaders met on Thursday, the German chancellor, Friedrich Merz, urged the EU to do a 'quick and simple' trade deal rather than a 'slow and complicated' one. His French counterpart, Emmanuel Macron, said he wanted a quick and pragmatic agreement, but could not accept terms that were not balanced. Oelrich, who is a member of the board of management at German pharmaceutical company Bayer, also called for a series of reforms on financing, pricing and regulation of drugs, saying such changes could help to restore Europe's former lead in research and development of drugs. His call comes amid fears the that EU is losing out to the US and, increasingly, China, which outpaced Europe in 2023 as originator of new active substances, with 25 brought to the world market, compared to the EU's 17 and the US's 28. Sign up to Business Today Get set for the working day – we'll point you to all the business news and analysis you need every morning after newsletter promotion Oelrich said data showed that 'a quarter of drugs in the past 10 years approved by FDA' in the US had not made it to Europe because of non-tariff barriers, such as differing national regulations and pricing. 'Many of the biotech companies are not even bothering engaging in Europe. For them it makes no sense,' he said. Among the other non-tariff barriers he cited were practices in the industry known as 'clawbacks' whereby governments in large economies including France and the UK agree a specific budget for procurement of particular drugs. But any surplus used in hospitals and clinics is paid for by the pharma companies as a clawback. 'It's totally senseless. And that's happening in Europe, and that needs to stop. I could name you endless countries that actually are doing this in Europe,' he said. 'What happens too much in Europe is that the richest countries would like to align to the lowest prices in lower equity countries … this leads to a situation which is unsustainable.'
Malay Mail
a day ago
- Business
- Malay Mail
Europe's strategic reset: Turning Trump's return into opportunity, a 10 is still a 10? — Phar Kim Beng and Luthfy Hamzah
JUNE 27 — With the July 9 deadline for a breakthrough transatlantic trade deal fast approaching, quiet recalibrations are already underway in Brussels. Gone is the rigid insistence on securing zero-per cent tariffs with Washington across the board. Instead, European officials are now signalling that they may accept a 10 per cent baseline tariff as the new normal in their negotiations with a returning Trump administration. As President Emmanuel Macron affirmed: 'A ten is still a ten.' In other words, it is better to handle a US tariff of ten per cent by July 9, rather than butting head with the Trump is for a complete zero perfect tariff. For many in the European Commission and key member states like France and Germany, this shift represents a calculated retreat from idealism in favour of strategic realism, for now. The goal is no longer perfect parity—but preferential predictability. If a 10 per cent tariff averts a full-blown trade war and preserves access to American markets for the EU's high-end manufacturers, especially in autos, chemicals, and green tech, then it may be the best bargain they can extract under the circumstances. This thinking was encapsulated by Lithuania's President Gitanas Nausėda, who stated that the EU could at most 'hope to be treated like the United Kingdom.' In other words, a bespoke, asymmetrical arrangement with moderate trade-offs is now being viewed not as failure, but as strategic hedging in a world of fast-shifting economic power dynamics. Rather than viewing Donald J. Trump's potential return to the White House as a catastrophe for transatlantic relations, parts of the EU are beginning to see it as a moment to reset — and even reimagine — their strategic position. Trump may be erratic, but he is also transactional. That opens space for negotiated gains — if approached with agility, focus, and a clear-eyed view of global shifts. One such shift — arguably the most significant yet under-discussed — is the recent rare earth agreement between the United States and China. At first glance, it appears contradictory: after all, Washington and Beijing remain locked in a broader techno-strategic rivalry, complete with sanctions, export controls, and decoupling rhetoric. But the deal reveals something deeper about the evolving nature of power: even rivals must cooperate in critical sectors. The US-China rare earth deal: A strategic necessity Rare earth elements — 17 obscure minerals with names like neodymium, dysprosium, and terbium — are the backbone of modern technology, from smartphones to missiles, wind turbines to EV motors. For years, China has maintained a near-monopoly over their mining and processing, controlling over 69 per cent of global supply. This strategic dominance has long worried US officials, especially as green and defence technologies escalate in both importance and demand. Against this backdrop, the United States has moved to secure a limited but crucial agreement with China: Beijing will guarantee stable exports of rare earths and certain value-added materials to American industries under a supervised, traceable regime. In return, Washington has agreed to temporarily relax specific export restrictions on American advanced mining equipment and allow non-dual-use technology exchanges in the sector. This deal — quietly negotiated between mid-level envoys in Geneva and Singapore over the past six months — is not a truce in the broader US-China contest. Rather, it is a strategic compartmentalisation, allowing both powers to secure mutual interests in one domain while continuing to compete in others. For Europe, however, the implications are profound: the two superpowers are cutting deals without Brussels at the table — and over resources that will define the 21st century. Europe's critical crossroads This US-China rare earth accord exposes a structural weakness in the EU's global positioning. Despite years of talk about 'strategic autonomy,' the EU has yet to develop significant rare earth processing capacity. Projects in Sweden, Greenland, and France remain years from operational maturity. Meanwhile, the bloc's dependency on Chinese supply remains near-total. Even worse, the EU lacks a coherent common foreign economic policy to negotiate comparable bilateral deals. Its consensus-driven model, though admirable for democratic governance, often hinders agility in crisis response and strategic industrial decisions. President Nausėda's comment reflects an awareness that the EU must now negotiate from a position of limited leverage. Trump's transactionalism may, paradoxically, offer opportunity here. If Brussels can align its interests with Washington's emerging industrial policy — particularly around clean tech, AI, and semiconductors — it may yet secure sector-specific pacts even under a sceptical or abrasive administration. US President Donald Trump gestures during a press conference at a Nato summit in The Hague, Netherlands June 25, 2025. — Reuters pic A three-pronged reset for Europe To seize this opportunity, the EU must reframe Trump's potential presidency not as a threat but as a catalyst for strategic reset. This entails a three-pronged strategy: 1. Rebuild transatlantic trust through sectoral alignment: Europe should identify sectors where mutual interests with the US are strong and immediate — such as rare earths, hydrogen energy, and cyber defence — and offer co-investment frameworks. A Euro-American Innovation Corridor could be one such proposal, linking industrial clusters across both sides of the Atlantic. 2. Invest in rare earth autonomy, urgently: Brussels must expedite projects in Sweden and Greenland but also partner with African and South-east Asian countries rich in rare earth deposits. For example, with Malaysia already poised to position itself in rare earth processing in future, especially on non-radioactive separation technology with Japanese or Chinese assistance, the EU should offer co-financing, governance frameworks, and environmental best practices in Malaysia to create a non-China-aligned supply network. If EU wants to. Otherwise, EU would be lacking in any leverage with US and China separately. 3. Speak with one voice in trade negotiations: If individual member states — especially Germany and France — pursue bilateral deals with the US, the EU's collective weight will diminish. A unified negotiating front, supported by the European Commission and the European External Action Service, is critical to avoiding divide-and-rule outcomes under a Trump presidency. Trump's style, Europe's substance Unlike the Cold War era, today's great power competition isn't about ideology alone — it's about who controls the flows of technology, data, and critical materials. Trump's preference for deals over doctrines may clash with the EU's normative style but therein lies an opening. Europe must learn to translate its regulatory power into geo-economic leverage, and to do so swiftly. The EU can no longer afford to expect 'special relationship' privileges. It must earn them. This means real investments in defence (to answer Trump's Nato criticisms), real proposals on trade (to complement US nearshoring), and real partnerships with third countries (to diversify away from Chinese dependence). President Nausėda's statement should not be seen as defeatist, but as pragmatic. If Europe accepts the reality of Trump's worldview and responds with bold, flexible initiatives, it can avoid marginalisation. Strategic reset begins not in despair — but in clarity. Conclusion: Reset, not retreat The rare earth deal between the US and China shows that even amidst rivalry, room for cooperation exists — if interests align. For the EU, the lesson is clear: waiting for ideal conditions is no longer viable. It must act now to safeguard its industrial future, secure its place in the new trade order, and reimagine its transatlantic relationship — regardless of who sits in the Oval Office. Trump may not be the leader Europe wanted. But he may be the wake-up call it needs. *Phar Kim Beng is Professor of Asean Studies at the International Islamic University Malaysia. Director of Institute of Internationalisation and Asean Studies (IINTAS). Luthfy Hamzah is Senior Research Fellow at Strategic Pan Indo Pacific Arena (SPIPA) Kuala Lumpur. Both authors write on geopolitics, global trade, and strategic affairs in Asean, EU and US China dynamics. * This is the personal opinion of the writers or publication and does not necessarily represent the views of Malay Mail.
