US may boost tariffs on EU goods: Lighthizer

The United States goods trade deficit with the European Union could hit $180bn in 2019, says US trade representative.

Cheese market in Gouda,
The recently imposed tariffs on $7.5bn worth of European goods also includes cheese [File: Yves Herman/Reuters]

The United States may increase tariffs on European goods as it seeks to slash its chronic trade deficit with the continent, US Trade Representative Robert Lighthizer said on Tuesday. The comment highlights a top trade priority for the administration of US President Donald Trump.

Lighthizer told Fox Business Network that recently imposed tariffs on $7.5bn worth of European goods as part of the Boeing-Airbus aircraft subsidy dispute could be increased as the two sides try to negotiate a settlement.

“We’re looking at that, we may increase that, our objective is to try to get some kind of negotiated solution,” Lighthizer said in a live interview.

“But we have a very unbalanced relationship with Europe.”

The US trade chief – who last week announced a “phase one” trade agreement with China and reached a deal with Mexico, Canada and US Democrats to revise a North American trade pact – declined to speculate on whether European cars and auto parts could be a target for potential new tariffs.

But he said that the US goods trade deficit with the European Union could hit $180bn in 2019, and the US needed to find ways to sell more goods to Europe. According to US Census Bureau data, that deficit was about $169bn in 2018.

“That can’t continue. There are a lot of barriers to trade there, and there are a lot of other problems that we have to address,” Lighthizer said. “You can’t get the global trade deficit down without getting the trade deficit down with Europe, at least significantly. So that’s a really important focus for us.”

The US-EU trade gap now includes about a $5.5bn annual trade deficit with the United Kingdom, which is negotiating an exit from the EU.

Lighthizer said that a US-UK trade deal is a priority for Washington, and negotiations will be launched as soon as the UK is in a position to do so.

“For sure, the UK is a priority. As soon as they get their objectives agreed to, we’ll start talking,” Lighthizer said.

Lighthizer also touted his new agreement with Beijing, repeating that it would nearly double US exports to China.

He said details of the Chinese purchases across US agriculture, manufacturing, energy and service sectors in the phase one China trade deal would be detailed in writing.

Lighthizer, outlining the purchases in the agreement, told Fox Business Network “this will all be written out”, but gave no further details about when the written agreement would be released.

Source: Reuters