US threatens 17% food tariffs as EU trade talks near deadline – all details here

The US has warned it may impose 17% tariffs on EU food and farm exports, an EU diplomat revealed Friday, according to a Reuters report.

This new threat comes as negotiations intensify before President Trump’s July 9 deadline to impose 50% tariffs on all EU goods.

Currently, EU products face 10% baseline tariffs, with higher rates for cars (25%) and steel/aluminum (50%).

Treasury Secretary Scott Bessent confirmed that weekend negotiations will continue, while Trump plans to send final tariff letters to trading partners by August 1.

EU considers 10% tariff compromise with exemptions

EU negotiators may accept maintaining the 10% baseline tariff for most goods in exchange for sectoral exemptions.

The bloc seeks immediate relief for pharmaceuticals, aircraft, semiconductors, and alcohol exports – critical industries where supply chains span the Atlantic. Germany and Italy support this approach, but France demands matching 10% tariffs on US goods if implemented.

The potential deal resembles the UK’s earlier agreement with Washington, avoiding detailed negotiations for now.
 

Internal EU splits complicate negotiations

Significant divisions among EU members weaken the bloc’s bargaining position. Germany’s Chancellor Friedrich Merz prioritizes protecting auto exports, calling for “quick solutions over perfect ones.”

France’s President Emmanuel Macron insists on full reciprocity, while Italy’s Giorgia Meloni appears willing to concede more to maintain US relations.

Smaller nations resist bearing retaliation costs for Germany’s trade surplus. These splits threaten to reduce the EU’s planned €95 billion retaliation package to €72 billion.

Global tariff landscape takes shape

Other nations face varied outcomes: Vietnam secured a 20% tariff deal (down from 46%) with strict anti-transshipment rules. China gained eased restrictions on chip software and ethane exports.

Japan confronts potential 30-35% tariffs after talks soured, while Canada resumed negotiations after scrapping its digital tax. The EU has readied €21 billion in immediate counter-tariffs targeting US goods, with broader measures pending .