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FRIDAY, JULY 27, 2018
Click HERE for Wednesday's quote from the U.S. on China and the WTO.
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THE NEW DEAL: EU-U.S.
"[W]hen I was invited by the President to the White House, I had one intention: I had the intention to make a deal today. And we made a deal today."
July 25, 2018
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Jean-Claude Juncker is the President of the European Commission. One always wants to see the proof of the pudding, but on first impression, his meeting with President Trump this past Wednesday was one of, if not the, most important trade policy event of the Trump presidency. It was followed by an explosion of commentary from the Washington trade community and their counterparts around the world.
Our purpose here is not to try to distill or summarize those reactions. We only seek to take note of some of the highlights from the comments by the two leaders, President Trump and President Juncker, this week in the White House Rose Garden.
President Trump opened the event saying:
We had a big day. Very big. We met right here in the White House to launch a new phase in the relationship between the United States and European Union.
Among the elements of their agreement referenced by President Trump, President Juncker, or both, were these:
232 Tariffs. Regarding the U.S. tariffs on steel and aluminum from the EU, imposed under the national security provision of the Trade Expansion Act of 1962, President Trump said the two sides would "resolve" the issue of these tariffs along with that of the retaliatory tariffs imposed by the EU on U.S. products.
FTA. The two sides will work towards "zero tariffs, zero non-tariff barriers, and zero subsidies on non-auto industrial goods," President Trump said.
U.S. Ag. Exports. Specifically, the EU will increase its purchase of U.S. soybeans. President Juncker said, "[T]he European Union can import more soybeans from the U.S., and it will be done."
U.S. Natural Gas. The EU has also agreed to increase imports of U.S. liquified natural gas. Referring to this element of the deal, President Juncker said, "This is also a message to others." We assume he was referring to Russia.
Standards. "We agreed to establish a dialogue on standards,"
President Juncker said.
WTO Reform (and China). Both President Trump and President Juncker talked about working together to "reform the WTO." In President Trump's formulation, there was a strong suggestion that the reforms they are thinking about arise in part from concerns over Chinese practices. He said:
We will therefore work closely together with like-minded partners to reform the WTO and to address unfair trading practices, including intellectual property theft, forced technology transfer, industrial subsidies, distortions created by state-owned enterprises, and overcapacity.
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To repeat, our goal here is just to ensure that these pages include a link to the joint press statements by President Trump and President Juncker on Wednesday, July 25. From Brexit to Beijing, there are countless related issues. Commentary on those and on the U.S.-EU negotiations will come later.
Our first impression is that President Trump was right. Wednesday was a big day. Historically, cooperation between the U.S. and the EU has been the cornerstone of major developments in the global trading system. Things have changed a bit, but that alliance is still central to anything like agreed global norms. (In any event, a commitment to reform the WTO - difficult as that may be - ought to quash for now the rumors of a U.S. withdrawal from it.)
We'll conclude this week with two other perspectives on the Trump-Juncker accord. On the skeptical side is French President Emmanuel Macron who has been widely quoted as saying he is "not in favor of us launching a vast trade agreement, along the lines of TTIP ... ."
Senator Lindsey Graham (R-SC) was decidedly more upbeat. Appearing on Fox news on Wednesday, he said:
With the European Union, it could be a major breakthrough, maybe the biggest change between us and Europe since the end of World War II, if he can pull it off. When it comes to China, they're the biggest cheater. The tariffs are hurting, but we've got to experience some pain to bring about change. So, I'm going to stick with the President. And if he can put a win on the board with Europe ... then eventually Canada and Mexico....all of us turn our attention on China ... be a home run.
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Joint Press Statements is a link to the comments this past Wednesday, July 25, by Donald Trump and Jean-Claude Juncker on the promised to new trade arrangement between the United States and the European Union. This is a link to a page on the White House website.
Macron Skeptical is an article for EURACTIV.COM with the above quote from President Macron.
Graham with the President takes you to a YouTube clip of the Fox News segment with the above quote from Senator Graham.
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R. K. Morris, Editor
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