00:00Now, Donald Trump has pushed back a July 9 deadline for most countries to secure trade deals with the United States on the 1st of August.
00:07But the U.S. President suggested that deadline is not 100% firm, adding he would consider extensions if countries made proposals.
00:16Trump still has outstanding differences on trade with the European Union.
00:20The bloc is facing a current baseline tariff of 10%, but is hoping for possible exemptions.
00:25For more on all of this, we can bring in our European affairs editor, Armin Georgian.
00:30Armin, great to see you. How are the negotiations going?
00:33Well, they've been very intense, especially in the last few weeks, Delano.
00:37The bottom line is it looks as if the two sides will keep negotiating beyond the July 9 deadline.
00:44The next deadline is August 1st.
00:48And if there is no deal at that point, then the EU could see tariffs of 50% applied by the U.S. across the board to European products.
00:58I suspect, though, given how intense these diplomatic sort of talks have been recently, I think it would be reasonable to expect that the EU will be able to work something out.
01:12Of course, you never know with Trump, but it seems reasonable to expect that the EU will be able to lock in this current 10% that you mentioned,
01:20this 10% baseline tariff that the U.S. is currently imposing on the EU beyond August 1st then.
01:28But, of course, as you also said, Delano, it's trying to get some exemptions on certain products, perhaps alcohol, wine and spirits, cosmetics, aircraft parts, things like that.
01:39So if we go ahead and have these exemptions, could that potentially create discord within EU members?
01:45For sure, because EU members have different industrial priorities, of course.
01:50But I think it's important to mention, Delano, that the current U.S. tariffs regime has already created discord over the last few months in the EU.
02:00You've got the French, for example, who keep saying that the current asymmetrical situation is not acceptable.
02:05What they mean by asymmetrical is that when the U.S. imposed this 10% baseline tariff, the EU didn't retaliate in order to give space to negotiations.
02:14And then over time, that becomes basically a permanent situation.
02:17The French don't want that.
02:19Meanwhile, recently, the Italian prime minister said actually keeping in this 10% asymmetrical situation would not affect Italy that much.
02:29And at the same time, you've got the German chancellor, of course, where the car industry is very important.
02:35He wants a quick deal because remember that the current Trump tariffs regime already has a 25% tariff on European cars, which really affects the Germans.
02:46So you've already got differences between the EU member states.
02:50I recently talked to the French Europe or the minister delegate for Europe, Benjamin Haddad, about all of this.
02:56Let's take a listen to him now.
02:58Right now, we have a situation where you have 10% tariff on European goods, 25% on steel and aluminum.
03:06It's not acceptable.
03:07It cannot be accepted as a sort of new normal of the trade relationship.
03:12So let's have a negotiation.
03:13Let's have a solution that allows us to go back to what was the situation before and trade between the United States and Europe.
03:20It's in everyone's interest.
03:21But we have instruments, once again, to be able to defend collectively our interests.
03:26And I heard this from the president of the European Commission.
03:29Basically, Delano, he's saying we should go back to zero for zero tariffs and not have this situation which eventually becomes permanent,
03:36where you've got, you know, 10% rate coming in from the US and or even other rates and the EU doesn't retaliate.
03:43We should go back to zero for zero.
03:45As I understand it, there are other countries, as well as France, pushing against this new normal, right, that the French don't want.
03:52That would be Portugal, Sweden and Luxembourg.
03:55The problem for those countries is that you've got other EU member states that are now, as I understand it,
04:01are becoming more resigned to keeping this asymmetrical situation, this unequal situation,
04:08because for them, the alternative could be even worse.
04:12If we end up with even higher tariffs on EU products, that would be even worse.
04:18So they seem to be open to keeping this sort of asymmetrical, unfair, if you will, unequal situation,
04:25but then bringing in a few exemptions to try and kind of smooth over the rough edges.
04:31But to come back to what we said at the start, you never know with Trump, right?
04:34It's very confusing.
04:35Yeah, because he said in his letter to the South Koreans, for example, this is still subject to change.
04:42This could still change.
04:43So you never really know with him, but negotiations will be going on again beyond July 9th.
04:49And that August 1st deadline could potentially be pushed back.
04:52Exactly.
04:53So it's very, very confusing.
04:54It's very confusing.
04:55It could go on beyond August 1st.
04:57And meanwhile, we would have this locked in 10%, which, as I said, France and a few other countries
05:02don't want that to become a permanent fixture.
