EU countries push to settle US trade deal to avoid tariff hike

The European Union EU has planned a new strategy to avoid tariff hikes in global trade networks.

According to EU diplomats, the European Union countries are broadly pushing for the swift implementation of the bloc's side ‌of a trade deal struck with the United States last year to ward off the threat of higher auto tariffs.

Representatives of the European Parliament and the Council, the body representing EU governments, will on Wednesday resume negotiations on legislation to lower EU duties on imported U.S. goods, with the EU assembly wanting to establish multiple safeguards.

It comes as U.S. President Donald Trump said on Friday he would increase tariffs on EU cars and trucks to 25% in the coming week because the EU was not complying with the terms of the deal struck at his Turnberry golf resort in Scotland in July.

Nine months later, the EU is yet to remove tariffs on imported U.S. industrial goods, as the two sides agreed. Legislation to do so was twice paused by the European Parliament after Trump's threats to impose new tariffs on European allies who did not back his proposed acquisition of Greenland and his new import levy.

Moreover, German Chancellor Friedrich Merz, whose country is likely to be hit hardest by a car tariff increase, told broadcaster ARD: "The Americans have it finalized, and ‌the Europeans haven't—and that's why I hope we can reach an agreement as quickly as possible."

EU members largely want a quick agreement between Parliament and Council on implementing the bloc's side of the deal, diplomats said.

Manfred Weber, the head of the center-right European People's Party, the largest group in the EU parliament, also said there should be a swift conclusion to negotiations to allow parliament to give its final approval this month.

Bernd Lange, who chairs the parliament's trade committee and will lead negotiations for the EU assembly on Wednesday, as he believes it would be ambitious timing.

Ignacio García Bercero, a senior fellow at think tank Bruegel who previously headed EU trade negotiations, said the tariff threat appeared partly a move to put pressure on EU parties to reach an agreement.

"The EU should take the time it needs to reach an agreement, not give in to pressure nor move to escalation," he said, adding that applying pressure could be counterproductive.