President Donald Trump has backed off his threat to impose tariffs on imported cars, following a meeting with European Commission President Jean-Claude Juncker, averting at least for now a trade war between the US and EU.
The two leaders said they would hold off on other tariffs while they negotiate a new deal to expand European imports of US natural gas and soybeans, as well as to lower industrial levies, Bloomberg reports.
Trump met with Juncker at the White House on Wednesday, with Trump previously threatening that he would impose a 25-percent tariff on auto imports if the meeting didn’t go well. EU warned that such a move would bring the necessary retaliatory measures on imported U.S. goods.
“We had a big day, very big,” Trump said during a press conference with Juncker. “We are starting the negotiation right now, but we know where it is going.”
Trump also added that they would try to “resolve” the steel and aluminum tariffs he imposed earlier this year and the counter measures levied by the EU in response. The U.S. and EU will also work together to reform the World Trade Organization and revisit unfair trading practices, according to a joint statement.
According to the European Automobile Manufacturers Association (ACEA), the EU-US auto-related trade is currently accounting for some 10 percent of the total trade between the two regions.
“Our industry thrives best in an environment without trade barriers. Yesterday’s agreement to initiate bilateral negotiations that seek to reduce tariff and non-tariff barriers to trade on industrial goods is a step in the right direction towards de-escalating trade tensions and addressing a trade-positive agenda,” stated ACEA Secretary General, Erik Jonnaert.
“Of course, there is a long way to go, and a lot of issues still need to be worked out,” Jonnaert cautioned. “However, we remain confident that the outcome will be positive for the EU and US economies as well as consumers on both sides of the Atlantic.”