German Chancellor Friedrich Merz is pushing the European Union to strike a trade agreement with President Donald Trump within days.
Merz said he would push EU leaders to quickly strike a deal at Thursday’s summit, together with French President Emmanuel Macron and Italian Prime Minister Giorgia Meloni, Politico reported. Anxieties have risen among EU leaders after the United Kingdom was able to strike a favorable deal with Trump well ahead of the 27-nation bloc.
“I still hope that a trade power like the EU, with 450 million people, has more leverage than the U.K.,” a senior EU diplomat said on Wednesday, according to the outlet.
Merz urged the EU to cut its losses and prioritize the protection of certain industries, including the car, manufacturing, semiconductor, pharma, and steel and aluminum industries from targeted tariffs threatened by Trump. Notably, all of these sectors are crucial to the German economy.
Merz’s original hope, that the EU could strike a zero-tariff deal similar to that reached by the U.K., seems increasingly distant. The EU negotiating team said that the U.S. is only willing to offer minor concessions, such as smaller tariff reductions tied to limited quotas.
Trump has threatened to impose 50% tariffs on all EU imports if a trade deal isn’t struck by July 9. EU negotiators worry that they won’t be able to iron out all the details before then, particularly on difficult areas such as cars — one of Merz’s priorities.
A scoping document sent to EU countries in May revealed the EU Commission is offering to match U.S. regulations on self-driving vehicles, the outlet reported, a major concession that was previously the fatal sticking point of an attempted trans-Atlantic trade deal a decade ago.
If negotiators proceed and strike a deal on unfavorable terms, EU leaders like Merz will face major political backlash at home.
“If the deal gets too imbalanced, it will get a very bad reception by most of our national public opinions,” an EU official told Politico.
Germany has the most to lose, given it’s the EU’s biggest exporter.
Trump’s argument that the EU has treated its American ally unfairly was supported by a June report published by Public Policy Solutions. The report showed how the EU disproportionately punishes U.S. tech companies while its own operate largely unmolested in the U.S. At the same time, EU regulators largely leave China off the hook.
“While EU companies enjoy open market access in the United States, Europe is doing everything it can to disadvantage U.S. companies in their markets,” the report read. “To make matters worse, these misguided policies have left an opening for Chinese 5G and telecommunications influence in Europe, posing national security risks and creating interoperability challenges for allies.”
EU’S PROTECTIONIST POLICIES THAT ‘DISADVANTAGE’ US EXPOSED AS TRUMP BATTLES CLOCK ON TRADE DEAL
Public Policy Solutions suggested incorporating three provisions in the upcoming U.S.-EU trade deal: eliminating all discriminatory taxes, fines, and laws against American digital companies; abandoning unfair regulations; and suspending consideration of the upcoming Digital Network Act, which, if adopted, would transfer wealth from American companies to European companies.
“While we’ve long expected unfair and predatory trade practices from adversaries, we’ve been far too slow to recognize and curtail similar behavior from Europe,” Public Policy Solutions founder and President Joe Grogan said in a statement to the Washington Examiner. “In order to restore balance to our partnership with the EU, any trade deal must address non-tariff barriers like digital service taxes and end their protectionist approach to these American innovators.”