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Amid trade war fears, EU overrules France and green lights talks with USA

Emmanuel Dunand, AFP | The European Union announced Monday that it is ready to start talks on a trade agreement with the United States.
4 min

European Union countries on Monday overruled France and gave the green light for Brussels to open trade talks with Washington as soon as possible and defuse trans-Atlantic tensions.


The EU's 28 member states had struggled for months to agree on a mandate to open the talks, with some fearing the delay would restart a trade war with US President Donald Trump.

But EU ministers meeting in Luxembourg approved a mandate to negotiate "an agreement limited to the elimination of tariffs for industrial goods only" and another accord designed to remove non-tariff barriers.

The ministers said the mandate would exclude agriculture products, which EU trade minister Cecilia Malmstrom said amounted to a "red line" for Europe.

US officials have said farm products should be included.

"I will now get in contact with our American partners with a view to organising a date for the first round as soon as possible," Malmstrom told a press conference in Brussels.

"If we agree to start, I think it can go quite quickly," she added.

The trade commissioner underlined the determination of the European Commission, the EU's executive arm, to finish the talks before its five-year term ends on October 31.

French resistance

EU sources said France voted against the mandate and Belgium abstained during a meeting of EU ministers in Luxembourg.

Pursuing a limited trade deal is a key element of a truce negotiated in July that came close earlier this month to imploding after the US threatened $11 billion in fresh trade tariffs against Europe.

Paris voted against the mandate over worries about domestic blowback just months ahead of European elections, set for May 23 to 26.

French President Emmanuel Macron has insisted the US first sign back up to the Paris climate accord after Trump dumped the pact in 2017, infuriating Macron.

But only a qualified majority of EU members was needed to support the talks, meaning France's "non" remained largely symbolic.

France's EU partners tried to win Macron over by agreeing to insist on environmental guarantees during the talks with Washington.

France nonetheless obtained a specific mention that TTIP, a far more ambitious transatlantic trade plan that never materialised, be officially called "obsolete".

The TTIP deal stalled following widespread protests in Germany, France and Austria over fears it would undermine EU standards on food and health.

At France's demand, agricultural products are also off the table.

But a French aide said recently that Paris was still smarting over Trump's latest tariff threats and his refusal to reverse steep tariffs on European steel and aluminium.

Berlin strongly wants the limited deal in order to placate Trump and avoid US auto tariffs that would punish Germany's cherished exports.


The mandate from the EU stipulates that the talks would end if the US pursued more levies against Europe, including on cars.

The limited deal, which officials say can be negotiated quickly, concerns only industrial goods, excluding the automotive sector. Fishing is also included, but not agriculture, services or public procurement.

The US however insists its wants to discuss agriculture, while Europeans would like to include cars. Both sides will have to agree on the divergences before the start of talks.

At a meeting last July at the White House, Trump and European Commission President Jean-Claude Juncker pledged no new tariffs following those on steel and aluminium.

That peace was in danger earlier this month after the US threatened to impose tariff counter-measures of up to $11.2 billion on a host of European products in response to subsidies received by aircraft maker Airbus.

But Malmstrom said: "We are convinced from the EU side that this agreement will be win-win."

It would increase EU exports to the US by eight percent and US exports to the bloc by nine percent.


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