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The United States has issued a threat to impose 17 percent tariffs on agricultural exports from the European Union in a new development in the ongoing trade conflict between the US and Brussels, according to sources familiar with the matter.
This last-minute decision, characterized by EU officials as an escalation of the transatlantic dispute, comes as the deadline of July 9 approaches for reaching a deal between the two trading partners.
President Donald Trump had initially imposed a 20 percent “reciprocal” tariff in April, which was later reduced to 10 percent until July 9 to facilitate negotiations.
Until recently, EU officials had anticipated that talks with the US would maintain duties at the baseline rate.
It is unclear whether the proposed 17 percent tariff on food products would be in addition to the existing tariffs announced by Trump or if it would replace them.
Trump has been demanding that Brussels grant wide-ranging exemptions to American companies from regulations and reduce its trade surplus with the US. However, EU officials have rebuffed Washington’s latest proposals regarding exemptions and food tariffs.
The EU is seeking its own exemptions for certain products, with aircraft parts and spirits cited as examples by a Brussels official.
Although the two sides are working on a five-page draft “agreement in principle,” there is currently very little agreed-upon text within it.
European Commission President Ursula von der Leyen expressed hope for an agreement in principle that would allow for continued discussions while a final deal is pending.
Meanwhile, Washington is urging countries to reach binding agreements by Trump’s deadline.
EU Trade Commissioner Maroš Šefčovič was informed of the proposed 17 percent duties on agrifood during meetings in Washington, with EU member-state ambassadors being briefed on the matter the following day.
Last year, the value of EU agrifood exports to the US, including products like wine, amounted to €48 billion.
Šefčovič has consistently emphasized that adapting EU regulations to suit the US is a red line for the EU. However, the EU is also undergoing a deregulatory process that involves weakening some environmental laws.
EU member states are divided between those willing to accept higher tariffs in exchange for a period of certainty and those advocating for retaliatory measures to pressure the US into compromising.
German Chancellor Friedrich Merz, whose country has the EU’s largest and most export-dependent economy, has been pushing for a swift resolution from the commission, particularly seeking exemptions from Trump’s sectoral tariffs on vehicles and steel.
During Friday’s meeting, several ambassadors reportedly called for stronger action against Washington, contrary to Merz’s stance.
According to EU diplomats, the US has outlined three potential scenarios for July 9: countries with an “agreement in principle” would maintain the 10 percent tariffs with the possibility of further relief in the future; countries without such an agreement would revert to the April tariff levels until a deal is reached; and higher tariffs would be imposed on countries deemed to be negotiating in bad faith.
As the EU prepares to retaliate against US duties on its products, member states have already approved counter-tariffs on €21 billion of annual US exports starting July 14. Additionally, the commission is preparing a package of €95 billion in tariffs, including on aircraft and food.
A spokesperson for the European Commission stated, “The EU’s position has been clear from the start: we prefer a negotiated solution with the US, and this remains our priority. At the same time, we are preparing for the possibility that no satisfactory agreement is reached.”
As of now, the White House has not responded to requests for comment.