Art of the Deal: EU Offers Trump ‘Zero-for-Zero Tariffs’ on Industrial Goods with United States

EU Commission President Ursula von der Leyen said on Monday that the bloc has offered a “zero-for-zero tariff” trade arrangement on industrial goods with the United States in a bid to avoid a full-on trade war.

While the EU chief continued to condemn the reciprocal tariff measures enacted by U.S. President Donald Trump to rectify the long-standing transatlantic trade imbalance, as pressure from the markets began to take shape, Von der Leyen and other top eurocrats expressed willingness to negotiate with the White House.

“We stand ready to negotiate with the US,” the EU president said. “We have offered zero-for-zero tariffs for industrial goods as we have successfully done with many other trading partners. Because Europe is always ready for a good deal. So we keep it on the table.”

However, the German politician did not address other significant areas of concern expressed by the Trump administration, such as restrictions on American food imports or, perhaps more significantly, on EU tariffs against U.S. made automobiles, which currently stand at around four times the rate European cars are taxed when sent to the United States.

Von der Leyen warned that Brussels is “prepared to respond through countermeasures and defend our interests if the trade dispute continues.” The EU chief said that Brussels will take a two-pronged approach towards the Trump tariffs, firstly by reducing internal barriers within the bloc — as opposed to reducing further barriers with the U.S. — and of “diversifying” Europe’s trading partners.

“This is why we are deepening our relations with our trading partners: You know the deals we have done with Mercosur, Mexico, Switzerland, and we are working with India, Thailand, Malaysia, Indonesia and many others. With that, we want to be very clear: Europe stands together for our businesses and with our businesses for all Europeans in the European Union and beyond,” she said.

Meanwhile, speaking separately at a meeting of economic ministers in Luxembourg, the EU’s top trade envoy, Maroš Šefčovič, said that the “current trade situation with the United States, our most significant partner, is in a tough spot.”

The Slovak politician said that an estimated 70 per cent of EU exports to the United States, or around €380 ($414) billion, are facing tariffs between 20 and 25 per cent. Šefčovič said this would amount to €80 billion in duties taken by Washington, up from the €7 billion previously taxed.

The tariffs’ shock continued to rock European markets on Monday, with the Eurostoxx 600 index falling by about five per cent by midday. This perhaps acted as an impetus for the Eurocrats to make overtures to the Trump White House to stem the bleeding.

Like von der Leyen, Šefčovič offered up some potential areas of cooperation, saying that the “EU-US trade relationship could benefit from a fresh look and a boost in strategic areas.”

“We face similar challenges, for instance, global overcapacities driven by non-market practices, the race for leadership in semiconductors, or securing critical minerals. If we team up, we could build a truly transatlantic marketplace that benefits both sides,” he said.

Yet, the Eurocrat also spoke of a “paradigm shift” in which Europe should look beyond the United States, calling for increased “diversification” through strengthening trade ties with countries like India, Indonesia, Thailand, the Philippines and the Gulf states.

Šefčovič also spoke of “rebalancing” the bloc’s trading relationship with Communist China, which currently stands as the EU’s top importer, with a trade imbalance of €292 ($318) billion. Mirroring some of the demands the United States has made on the EU, which has a €197 ($215) billion trade surplus with America, Šefčovič said that Brussels will push Beijing to increase market access for European companies in China and to “level the playing field for EU companies in China.”

On the other side of the Atlantic, President Trump has held firm on his commitment to rebalancing global trade back to the favour of the United States, writing on Truth Social on Sunday evening: “We have massive Financial Deficits with China, the European Union, and many others. The only way this problem can be cured is with TARIFFS, which are now bringing Tens of Billions of Dollars into the U.S.A. They are already in effect, and a beautiful thing to behold.

“The Surplus with these Countries has grown during the ‘Presidency’ of Sleepy Joe Biden. We are going to reverse it, and reverse it QUICKLY. Some day people will realize that Tariffs, for the United States of America, are a very beautiful thing!”

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