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On US Government Trade Policy

Trump’s ‘America First’ Policy Puts Pressure on the EU

SWP Comment 2018/C 36, 03.09.2018, 4 Pages Research Areas

Given the US tariffs on steel and aluminium and further tariff threats, the transatlantic trade relationship remains tense. While EU Commission President Jean-Claude Juncker and US President Donald Trump agreed at their meeting on 26 July to start negotiations to reduce tariffs in several industrial sectors over a period of 120 days, it remains uncertain they can reach a compromise that allows both sides to save face. At the same time, Europe is struggling with an important, but as yet, unanswered question: Is the US government’s trade policy the result of a strategy designed to weaken geopolitical rivals like China, even if it adversely affects close partners such as the EU? Or does Trump really want to break away from the liberal multilateral order? The EU needs to prepare for both possibilities. Support could come increasingly from US companies.