Minister expects normal EU-US trade relationship to return.
The answer is that we must do both. We must negotiate, and as we’ve said, we’re ready to have dialogue on the economic relationship with the United States, but we’re also making a very firm, very strong response, which is ready, so as to be able to retaliate if the escalation on tariffs continues. It really has to be said that the US tariffs imposed by the Trump administration are totally unjustified and are in no way based on the real relationship between Europe and the United States. I want to say this because people calculate the United States’ trade deficit on goods, but don’t count the services – US digital services, for example – that are present in Europe; a number of taxes are included, for example VAT, which the American administration regards as a tariff, when in fact it’s a tax paid by both European businesses and foreign businesses that are on European soil.
So none of this is related. And above all, basically the US deficit with the European Union isn’t linked to customs tariffs by the European Union. It’s linked to a US economic model which is one of domestic demand and consumption and which has also been largely boosted by debt, including among households and individuals. So there’s no basis of any kind to all this. But do we know, then, what he [President Trump] expects of us? Can you, in all honesty… Can you say to your interlocutor: “This is what we can offer you”? What in fact is he expecting of us? What’s he expecting you to say?
THE MINISTER – In any case, Foreign Trade Commissioner Šefčovič will be in the United States. But the issue is above all about what we ourselves are expecting. We’re expecting to return to a normal economic and trade relationship with the United States. As you mentioned, we’ve returned to the same tariffs as the rest of the world, i.e. 10%.
We’ve still got 25% too, on steel and aluminium. Fortunately we’ve seen things rather calming down in recent days, so we must welcome that and try to engage in dialogue. But basically, we mustn’t… We really have to be clear here: we haven’t returned to a normal situation. We mustn’t accept the existing situation as a normal economic and trade situation between Europe and the United States – hence the very great vigilance on our part. What we’ve been repeating – and these are the messages we’re also sending to the European Commission, and that’s why we’ll be capable of responding in a really absolutely determined way, to hit the US economy in the event of the political dialogue failing…
So is the dialogue you’re currently having with the United States the opposite? In other words, is it about saying: “This is what happens if you don’t restore tariffs to where they were”? Can we say that’s what Europe’s dialogue currently is with the United States?
THE MINISTER – It’s about saying that we want to trade, to have a normal economic relationship with the United States again. And incidentally, when you see the consequences on the economy, on the stock markets, on American businesses, you can clearly see that tariffs and protectionism are in no one’s interest and hit the United States first – American consumers and households.
And so we’ve created the means to respond. Europe is strong and Europe has also strengthened its trade-defence instruments in recent years, because we’ve already had this, during Donald Trump’s first term, when we defended ourselves, we retaliated, and that’s what made it possible to de-escalate. In the meantime, we’ve created other instruments to tackle this very type of situation, like the renowned Anti-Coercion Instrument, which would allow us to tax digital services and digital-services advertisements, exclude US companies from some European procurement contracts and also seize intellectual property, and which therefore broadens the range, in particular to support what the European Union can do to defend itself. So we’re ready to defend ourselves, but we’d rather do so through political dialogue. But the two are linked, as you can see: it’s negotiation based on a power relationship.
But then if the United States – because this is our understanding – wants to try and lower some customs barriers, particularly on all non-tariff measures – one thinks of the tech giants, for example, or confidentiality policies etc., which the Americans won’t put up with… So if they turn up saying, “You’ll have to include non-tariff measures”, are you ready to say, “There’s no question of easing the slightest restriction on certain US exports”?
THE MINISTER – We’re not going to change our European rule of law under commercial pressure from the United States. What you’re referring to, the DSA or DMA [Digital Services Act, Digital Markets Act], are rules the European Union has created in recent years in the face of the digital giants. The Digital Services Act to combat online hatred, disinformation and manipulation of algorithms – more urgent then ever when you see, for example, the role Russia is playing on social media in the elections in Romania and Moldova. And the Digital Markets Act to combat anti-competitive, monopolistic practices by the digital giants. That’s our rule of law. We’re not going to change our own rules for protecting our markets or protecting freedom of expression and the fight against hatred on social media, in the face of trade coercion by the United States.
And incidentally, I wanted to emphasize that in an interview on this subject a few days ago, the European Commission President was extremely clear on this. So it’s not part of the negotiations. (…)
Basically, the question we must also ask ourselves as Europeans is about investing in our own competitiveness, our own economic attractiveness. It’s just the time to make ourselves less dependent on global geopolitical and economic upheavals and – while we see uncertainty about China and the United States – make the European Union the world’s number one area for investors, innovators and business start-ups. That involves simplification, it involves deepening the single market through an integrated business law system, it involves massive support for our innovators and industries, and also changing the competition and state-aid rules. (…)
Europe hasn’t responded to the covert advances from Beijing, which is saying: “Let’s resist together”. Is there a way of making it our ally, in your opinion? Perhaps by actually setting up a number of safeguards and preventing Europe from becoming a landing strip, as it were, for Chinese goods? Can those covert advances be heeded by Europe ?
THE MINISTER – Your last point is very important. Let’s also take care to comply with fair trading rules and not become the recipients of products that could also be subject to massive subsidies and unfair trading practices by China. So there are two points: firstly, the response to the United States, and secondly, protecting our market against other trading partners, starting with China.
That’s also the message we’ve sent to the European Commission. As you know, the European Commission adopted a few months ago, for example, customs barriers to Chinese electric vehicles entering Europe, because we’ve seen that they don’t comply with fair competition rules, because you have here a sector that is massively subsidized by China. So there too, we must be extremely cautious and vigilant. It’s an opportunity, of course, to diversify trading partners and turn to others – why not? – to deepen our relations. But we must always do it with a single guiding principle, namely to defend our interests, defend our businesses, our economies, our sovereignty, and reduce our dependence. So let’s not shift from one form of dependence to another. The most important thing, again, is to defend, to ensure Europe’s strategic autonomy