Good morning,
EU finance ministers will meet in Warsaw today buoyed by what one EU official called “fantastic news”: a 90-day suspension of US tariffs announced by US president Donald Trump. The move, which excludes China, has eased pressure on European exporters and injected a rare dose of optimism into transatlantic trade relations.
“This gives us breathing space,” the official said ahead of the meeting, expressing hope that a broader trade deal with Washington may still be possible.
The best part of the pause, the official implied, is that it gives the EU time to “strategise” — the first steps of which will be announced this weekend.
Still, the general mood in Europe is that it’s too early to tell.
“There’s no denying the situation remains serious,” the same source warned.
While the EU hopes to restore trade relations through negotiation, deals with the US are currently “physically impossible,” the source said, because the administration is “overwhelmed” by the sheer number of trade talks it is juggling.
China, pointedly excluded from the truce, now faces a 125 percent US tariff. Beijing’s 84 percent counter-move has already taken effect. “China’s response was a clear overreaction,” the official said, adding that a China-US trade war is “nothing to be happy about”.
That said, the EU smells opportunity. “At the moment, Europe is the most stable of the three big powers. That stability is valuable for investment,” the official said. “It’s a chance to draw in more investors, though the long-term effect is hard to measure.”
- Wester van Gaal, green economy journalist
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