The President of the EU, Jean-Claude Juncker was the USA for a meeting with President Trump against the backdrop of a mooted imposition of tariffs on EU car exports to the USA which would have been met with immediate countermeasures from the EU on specific US exports. Given that Mr Trump had boasted that the US would win any trade war and that using trade as a weapon to improve (as he would see it) trade deals was clearly a good strategy, few could have expected the outcome from the meeting.
The US has shelved the plan to levy tariffs on EU vehicle exports and for its part, the EU has agreed to import more US soybeans. The US President said that the two sides had a “very strong understanding” and had entered a “new phase” in their relations – just as well really as only this month he was describing the EU as a “foe” of the USA; a phrase which irrespective of context is remarkable to be uttered by a US President.
However, the new-found love fest between the world’s major economies did not extend to a lifting of the US tariffs on steel and aluminium which sparked the current difficulties. A joint statement claimed that the two sides would: "work together toward zero tariffs, zero non-tariff barriers, and zero subsidies on non-auto industrial goods". This sounds good, but probably needs to be viewed in the context of the EU’s vision statement that its members will “work towards ever closer union”.
The problem with US-EU trade does not (usually) lie with tariffs which are already low, but in a difference in standards and regulations which are (generally) higher in the EU. For US goods too further penetrate the EU market, either they would need to meet European standards or the EU would need to relax their position – neither seems very likely at the moment.
A working group of senior bureaucrats is being established to facilitate trade and lower barriers to trade. It is agreed that no new measures will be applied whilst these discussions are taking place, so it is a truce rather than an end to the trade war