EU says US trade deal is within reach, while backing counter-tariffs

The 27-nation bloc's executive has repeatedly said its primary focus is on reaching a deal to avert 30% U.S. tariffs that U.S. President Donald Trump has said he will apply on August 1.

"Our focus is on finding a negotiated outcome with the U.S. ... we believe such an outcome is within reach," an EU spokesperson said in response to reporters' questions.

The Commission had said on Wednesday it would press on in parallel with plans for potential countermeasures, merging two packages of proposed tariffs of 21 billion euros and 72 billion euros into a single list and submitting this to EU members for approval.

EU diplomats said they had overwhelmingly approved the measures on Thursday, which the Commission later confirmed.

The first package of countermeasures would enter force on August 7, with tariffs on soybeans and almonds delayed until December 1, an EU official said. The second package would enter force in two stages on September 7 and February 7.

So far the EU has held back from imposing any countermeasures, despite Trump's repeated announcements of tariffs, the steepest of which have been postponed. EU member states authorised the first package of countermeasures in April, but these were immediately suspended to allow time for negotiations.

CLOSING ON DEAL

The EU and United States now appear to be heading towards a possible trade deal, according to EU diplomats, which would result in a broad 15% tariff on EU goods imported into the U.S., mirroring a framework agreement Washington struck with Japan. Trump would still need to take any final decision.

The White House said discussions of a deal should be considered "speculation". Trump trade adviser Peter Navarro told Bloomberg News the report from the EU should be taken with "a grain of salt."

French Finance Minister Eric Lombard and Italian Industry Minister Adolfo Urso told a joint press conference in Paris they were not aware of a draft agreement, Urso adding he would only pass judgment when one was reached.

It is not clear what the EU would offer the United States to secure a deal. One EU diplomat said the bloc was not looking at a pledge of investment in the United States, as Japan has agreed.

Another said the EU might reduce some of its own duties. Its current import duty for cars is 10%.

Under the outlines of the potential deal, the 15% rate could apply to sectors including cars and pharmaceuticals and would not be added to long-standing U.S. duties, which average just under 5%.

There could also be exemptions for sectors such as aircraft, lumber as well as some medicines and agricultural products, which would not face tariffs, diplomats said.

Washington does not, however, appear willing to lower its 50% tariff on steel.