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The European Commission's outgoing president, Jean-Claude
Juncker, has said that he does not expect that the US will apply
tariffs on passenger cars imported from the European Union, reports
Reuters. In an interview with Germany's Sueddeutsche
Zeitung, Juncker said, "[US President Donald] Trump is going
to make some criticism, but there won't be any auto tariffs." He
added that "he [Trump] won't do it... You are speaking to a fully
informed man."
Significance: Although nothing will be certain
until President Trump makes a formal announcement, there is a
growing feeling that tariffs will not be applied. Indeed, Trump was
quoted last month as stating that the US government continues to
talk with the EU about trade, but aims to avoid imposing broader
tariffs for now, while US Treasury Secretary Steven Mnuchin has
praised the increased investment made by European automakers in the
country. Furthermore, even those that may have a vested interest in
restricting the number of imports from Europe are keen for this not
to happen, with the president of the American Automotive Policy
Council, Matt Blunt, telling Reuters that the council remains
"opposed to the imposition of Section 232 tariffs on automobiles or
parts" as "it would be harmful to the economy and the auto
industry". The decision on whether the US will apply the threatened
national security (Section 232) tariffs, which could amount to up
to 25% on vehicles and parts, will need to be taken by 14 November,
after its having already been delayed by six months. However, among
the alternative outcomes is a potential further six-month delay,
while one European diplomat involved has told Reuters that, while
discussions are heading in the right direction, there are concerns
that President Trump could abruptly change his mind at the last
minute.
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