President Donald Trump told European leaders Wednesday that the U.S. wants a “fair trade deal” with the European Union as both sides sought to defuse tensions in an escalating trade battle involving some of the world’s biggest economies.
Seated in the Oval Office, European Commission President Jean-Claude Juncker told Trump that the two trading partners were “allies, not enemies” and said they needed to work together to address recent frictions involving Trump’s threats to impose tariffs on auto imports and EU plans to retaliate.
“We should talk about reducing tariffs instead of increasing them,” Juncker said, as Trump nodded. The president again suggested the two sides could one day have no tariffs or barriers or subsidies on their products.
“We just want it to be a level playing field for our farmers, for our manufacturers, for everybody,” Trump said, suggesting the EU could also be a “big beneficiary” of a revised trading agreement.
The negotiations at the White House came as Trump has touched off a series of trade disputes with global trading partners, including China, whom he accused earlier Wednesday of employing “vicious” tactics aimed at hurting American farmers.
Trump’s defense came after his administration announced a plan to provide $12 billion in emergency relief for farmers who have been slammed by the president’s trade disputes with China and other countries.
Chinese President Xi Jinping said at an international summit in South Africa that the world faces “a choice between cooperation and confrontation,” in remarks that criticized escalating U.S. tariffs on goods from China and other major trading partners. He warned that those who pursue “economic hegemony” will “only end up hurting themselves.”
Trump has placed tariffs on imported steel and aluminum, saying they pose a threat to U.S. national security, an argument that the European Union and Canada rejects. He has also threatened to slap tariffs on imported cars, trucks and auto parts, potentially targeting imports that last year totaled $335 billion.
The president has repeatedly called the EU — which includes many of the U.S.’s oldest and most committed allies — an unfair trading partner and even labeled it a “foe.”
The European Union has warned that it will retaliate with tariffs on products worth $20 billion if Trump puts duties on cars and auto parts from Europe.
But any trade dispute involving automobiles would have major ramifications for both economies. The EU has a huge stake in the U.S. industry, where European companies produce almost 3 million cars a year, accounting for over a quarter of production in the United States.
On Tuesday, Trump suggested in a tweet that “both the U.S. and the E.U. drop all Tariffs, Barriers and Subsidies! That would finally be called Free Market and Fair Trade! Hope they do it, we are ready – but they won’t!”
Juncker, joined by EU trade chief Cecilia Malmstrom, was expected to raise the possibility of talks between major auto-exporting countries aimed at reducing tariffs on the auto trade worldwide, according to a senior European official who spoke on condition of anonymity to describe internal deliberations. And Juncker intended to discuss a possible EU-U.S. free-trade agreement that would reduce trade barriers on industrial products, including autos.
Congress is increasingly uneasy with Trump’s aggressive use of tariffs. Sens. Doug Jones, D-Ala., and Lamar Alexander, R-Tenn., on Wednesday introduced legislation that would delay Trump’s planned auto tariffs. The Jones-Alexander bill would require the independent International Trade Commission to conduct a study of the auto industry before the tariffs could be imposed.
“These tariffs are a tax on American consumers, and they’re going to cost Alabama jobs,” Jones said.
The Trump administration has imposed tariffs on $34 billion in Chinese goods in a dispute over Beijing’s high-tech industrial policies and has threatened to eventually target $500 billion. China has struck back with duties on soybeans and pork, affecting Midwest farmers in a region of the country that supported the president in his 2016 campaign.
On Tuesday, the administration announced a plan to give farmers some relief. The U.S. Agriculture Department said it would tap an existing program to provide $12 billion in direct payments and other assistance to farmers and ranchers hurt by foreign retaliation to Trump’s tariffs.
With congressional elections coming soon, the government action underscored administration concern about damage to U.S. farmers from Trump’s trade policies and the potential for losing House and Senate seats in the Midwest and elsewhere in November.