EU may get 15 per cent tariff deal with US: | Australian Markets

The European Union is heading in direction of a trade deal with the United States that may lead to a broad 15 per cent tariff on EU items imported into the US, avoiding a harsher 30 per cent levy slated to be carried out from August 1, two EU diplomats say.

The charge, which may additionally lengthen to automobiles, would mirror the framework settlement the United States struck with Japan.

Officials from the European Commission, which negotiates trade offers on behalf of the 27-member bloc, briefed EU envoys on the state of talks with their US counterparts.

US President Donald Trump would in the end make any last resolution on a deal, nonetheless.

Under the outlines of the potential deal, the 15 per cent charge may apply to sectors together with automobiles and prescription drugs and wouldn’t be added to long-standing US duties, which average slightly below 5 per cent.

There is also concessions for sectors like plane, lumber in addition to some medicines and agricultural merchandise, which might not face tariffs, the diplomats mentioned.

The US administration doesn’t, nonetheless, seem keen to decrease its present 50 per cent tariff on metal, they mentioned.

The Commission mentioned earlier on Wednesday that its major focus was to realize a negotiated final result to avert the threatened 30 per cent tariffs.

At the identical time it deliberate to submit counter-tariffs on 93 billion euros ($A166 billion) price of US items to EU members for approval.

A vote is anticipated on Thursday though no measures can be imposed till August 7.

Germany supported the EU readying countermeasures, a authorities consultant mentioned.

If Trump’s 30 per cent tariffs are carried out, EU diplomats additionally mentioned there was broad assist amongst European governments to activate wide-ranging so-called “anti-coercion” measures, which might enable the bloc to focus on US providers and different sectors.

The EU seems to be following within the footsteps of Japan, whose settlement with the United States is essentially the most vital Trump has struck since launching his tariff offensive in April.

European shares climbed about one per cent, led by car stocks, following the US-Japan announcement.

One stand-out function of that deal was that the identical 15 per cent charge applies to automobiles, in comparison with the present US tariff of 27.5 per cent, one thing the EU may need for its own car exports.

The US imported automobiles and automotive components valued at more than $US55 billion ($A84 billion) from Japan final yr.

EU exports had been 47.3 billion euros.

Far fewer US automobiles had been offered into the EU or Japanese markets.

EU officers say the US has proven little signal of budging on car tariffs however the Japan deal may trace at flexibility.

“Whatever the Japanese got will become the minimum for the EU negotiating objectives,” mentioned Simon Evenett, professor of geopolitics and strategy at IMD Business School.