By Metals Service Center Institute (MSCI)

US President Donald Trump and European Commission (EC) President Jean-Claude Juncker in late June in Washington, DC and came away with an informal agreement “to work together toward zero tariffs, zero non-tariff barriers, and zero subsidies on non-auto industrial goods” and “to reduce barriers and increase trade in services, chemicals, pharmaceuticals, medical products, as well as soybeans.”

Specifically, the two agreed to:

• Resolve the steel and aluminum tariff issues and retaliatory tariffs;
• Improve market access for all products;
• Strengthen “strategic cooperation with respect to energy,”;
• Close dialogue on standards “in order to ease trade, reduce bureaucratic obstacles, and slash costs”; and
• Work jointly to “protect American and European companies better from unfair global trade practices” and to “work closely together with like-minded partners to reform the World Trade Organization and to address unfair trading practices, including intellectual property theft, forced technology transfer, industrial subsidies, distortions created by state owned enterprises, and overcapacity.”

The agreement has a long way to go before it is settled and can take effect. In order to move forward, the United States and European Commission will convene an executive working group of top trade officials. This group will “identify short-term measures to facilitate commercial exchanges and assess existing tariff measures.” Trump and Juncker also promised that, as long as negotiations are ongoing, neither party will “go against the spirit of this agreement,” meaning U.S. tariffs on autos imported from countries represented by the EC are off the table for now. The text of the agreement can be found here.