The United States will seek to force the European Union to choose between the US and China on trade, according to briefings circulated to senior ministers and officials after Tánaiste Simon Harris’s meeting in Washington last week with US commerce secretary Howard Lutnick.
The briefings, confirmed by multiple senior sources, go considerably further than before in identifying the ultimate US agenda for any future trade negotiations.
They suggest that the overall US strategy is to decouple from China, and that any country who wishes to have a trade deal with the US will also have to distance itself from Beijing.
At present US tariffs on China amount to 145 per cent – though some electronic products, including mobile phones and laptops – were given a temporary reprieve over the weekend.
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The briefings suggest that the US is willing to consider a trade deal with the EU on these terms – but it would also want the EU to limit or discontinue non-tariff barriers to trade, potentially including stringent EU product standards, including some food standards.
At present neither US beef nor chicken can gain entry to the EU market because of strict EU rules – something which has repeatedly been complained of by the Trump administration.
But senior Irish and EU sources dismissed any chance that the EU would change its standards on, for example, hormone-treated beef and chlorine-washed chicken.
The briefing also suggests there is a strong likelihood of specific tariffs on pharmaceutical imports being imposed even during the 90-day pause – which saw the tariff on most EU goods reduced from 20 per cent to 10 per cent – announced by president Donald Trump last week.
The US may impose these additional tariffs even though it wants to see trade negotiations completed within this period. The tariffs on pharma could be introduced perhaps within a month, it is expected.
[ Trump tariffs: EU and US meet for talks amid growing trade uncertaintyOpens in new window ]
Yesterday Tánaiste and Minister for Foreign Affairs Simon Harris said that it would be “inappropriate” if the US were to impose further tariffs during negotiations.
“We’re either having good faith discussions or we’re not,” he told RTÉ. “And if we’re having good faith discussions, it means there should be a pause on any additional measures whilst those discussions take place.”
However, Mr Harris said it would be “foolish” to not prepare for a scenario where tariffs on trade announced by Mr Trump remained in place for the long term.
While he said the Government was “preparing for the worst”, it was also pushing for a EU-US deal that would see Mr Trump suspend tariffs he had raised since returning to office.
“When I was in [Washington] DC only a couple of days ago, I got the very clear impression that negotiation was something that the United States was now very interested in,” Mr Harris said.
But Mr Trump again indicated yesterday that his administration was preparing new tariffs on pharmaceutical imports “soon”, arguing that too many medicines are imported from Ireland and other countries and not produced in the US.
[ Chinese exports surge ahead of Trump’s 145% tariff on goodsOpens in new window ]
European trade commissioner Maroš Šefčovič, who has been leading the EU’s efforts to negotiate with the US administration, met commerce secretary Howard Lutnick in Washington DC on Monday, for further talks about trade tariffs.
In a brief statement after the meeting, Mr Šefčovič said there was a need to seize the opportunity of Mr Trump’s 90-day pause, where the US president scaled back higher tariff rates, after the policy caused turmoil in the financial markets.
“The EU remains constructive and ready for a deal,” Mr Šefčovič said. He repeated that could include both sides reducing pre-existing tariffs on imports of industrial goods to zero.
