ASSESSMENTS

Truce Aside, U.S.-EU Trade Relations Are In for a Bumpy Ride

Jul 30, 2018 | 08:30 GMT

Protesters use an inflatable Trojan horse outside European Union headquarters on Sept. 20, 2016, to express their disagreement with the planned Transatlantic Trade and Investment Partnership.

Protesters use an inflatable Trojan horse outside European Union headquarters on Sept. 20, 2016, to express their disagreement with the planned Transatlantic Trade and Investment Partnership. Trade talks between the European Union and the United States would stall the next month.

(JOHN THYS/AFP/Getty Images)

Highlights

  • Although the European Union and the United States agreed to negotiate a trade deal that includes only manufactured goods, Washington has already put agricultural products on the table and will likely keep them there as talks continue.
  • France, Italy and other protectionist governments on the Continent will resist U.S. – and likely German – calls for U.S.-EU trade talks to include agricultural products.
  • European leaders are already saying that talks will eventually need to include the auto sector and address U.S. "Buy American" laws.
  • American demands on agriculture and vehicle protectionism, however, could derail the prospects of a deal, making the future of U.S.-EU trade relations potentially stormy.

Although U.S. President Donald Trump and European Commission President Jean-Claude Juncker agreed to a trade truce and talks on July 25, it took less than 36 hours for significant divergences to emerge on where negotiations between the United States and the European Union may go from here. The differences do not bode well for the truce's longevity as talks are likely to eventually include stickier issues that have prevented a trans-Atlantic trade deal for years....

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