The European Union has formally proposed the removal of tariffs on United States industrial goods in return for reduced U.S. auto tariffs as a key part of the agreement the EU and U.S. struck last month.
As part of the deal, the EU has agreed to a 15% U.S. tariff on European cars and car parts.
This would be a reduction from the 27.5% tariff and is expected to save car makers more than €500 million in duties that would have otherwise been paid for in exports in one month only.
In response to the deal, Ursula von der Leyen, President of the European Commission, said the European Union will always pursue what is best for its citizens and businesses.
“This is not the end of the process; we continue to engage with the US to agree more tariff reductions, to identify more areas of cooperation, and to create more economic growth potential,” von der Leyen said.
“At the same time, we continue to diversify our international trade partnerships, creating EU jobs and prosperity.”
The proposal now needs to be approved by the European Parliament and Council, which could take weeks; however, the reduction of U.S. tariffs on the EU is set to take place before then.
This comes after weeks of intense negotiations. Under the deal, the EU also committed to purchasing US$750 billion worth of U.S. energy and investing at least an additional $600 million in the U.S.
