EU close to trade deal with US. 'Time is running out'

The European Union was rushing to finalize a trade deal with Trump before tariffs on almost all of its exports to the U.S. jumped to 50 percent, Bloomberg reported. EU and U.S. negotiators worked over the weekend to hammer out a preliminary agreement that would avoid a huge tariff escalation.

Trump to announce trade deals on Monday

Trump said he would announce trade deals on Monday and that trading partners would have until Aug. 1 before tariffs would go into effect. That gives them the opportunity to strike deals in the next three weeks . The administration previously said the tariffs would go into effect July 9.

The EU has indicated it is willing to accept a deal that includes a 10% universal tariff on many of its exports, but wants the United States to commit upfront to rates lower than 10% in key sectors such as pharmaceuticals, alcohol, semiconductors and commercial aircraft.

The EU is also pushing the United States to introduce quotas and exemptions to effectively lower Washington’s 25% tariff on cars and car parts, as well as its 50% tariff on steel and aluminum. Talks on these sectoral levies have been particularly difficult , according to Bloomberg . Some automakers and EU countries have been pushing for a mechanism that would provide tariff breaks in exchange for investment and production in the U.S.

The first framework agreement would also cover non-tariff barriers, economic security and cooperation in areas such as digital trade.

"Time is running out". Negotiations are ongoing in the EU

German Chancellor Friedrich Merz spoke over the weekend with French President Emmanuel Macron, Italian Prime Minister Giorgia Meloni and Commission President von der Leyen to discuss how to resolve the trade dispute.

- Time is running out - Merz spokesman Stefan Kornelius told reporters in Berlin on Monday. - I am always optimistic, but the Commission is considering various scenarios .

"We want a negotiated solution, but at the same time we know that we are preparing for the possibility that no satisfactory agreement will be reached," von der Leyen told reporters last week. " We will defend European interests if necessary , in other words, all instruments are on the table."

The EU has approved tariffs on €21 billion worth of US goods that could be implemented quickly in response to Trump’s metals tariffs. They target politically sensitive US states and include products such as soybeans from Louisiana, home to House Speaker Mike Johnson, as well as farm products, poultry and motorcycles.

The bloc has also prepared an additional list of tariffs on US products worth 95 billion euros in response to Trump’s so-called reciprocal tariffs and car tariffs. They will cover industrial goods including Boeing planes, US-made cars and bourbon.

The EU is also consulting member states to identify strategic areas where the US relies on the bloc, as well as potential measures beyond tariffs, such as export controls and restrictions on government procurement contracts.