U.S., EU reach trade agreement

By Jessica Domel

The European Union is about to buy “a lot of American soybeans.”

U.S. President Donald Trump and European Commission President Jean-Claude Juncker announced Wednesday, July 25, they had reached a deal to work together toward zero tariffs, zero non-tariff barriers and zero subsidies on non-auto industrial goods.

“We will also work to reduce barriers and increase trade in services, chemicals, pharmaceuticals, medical products, as well as soybeans. Soybeans is a big deal. And the European Union (EU) is going to start, almost immediately, to buy a lot of soybeans. They’re a tremendous market,” Trump said.

The announcement came a little more than a month after the EU instated 25 percent duties on $3.2 billion in U.S. goods, including farm produce.

The European Commission levied the tariffs in response to the United States’ new 25 percent tariff on imported steel and 10 percent tariff on imported aluminum.

Trump said the new agreement reached Wednesday launches a new phase in the relationship between the U.S. and the EU.

“A phase of close friendship, of strong trade relations, in which both of us will win,” Trump said.

The EU’s agreement to buy more American soybeans is expected to offset the decline in China’s purchases. The People’s Republic of China hit U.S. soybeans with a new tariff in retaliation for the steel and aluminum tariffs.

Soybeans are one of the U.S.’ main agricultural exports to China, accounting for around $14 billion a year.

President Trump said the EU’s commitment will open markets for U.S. farmers and workers, increase investment and lead to greater prosperity.

“It will also make trade fairer and more reciprocal,” Trump said.

The E.U. has also reportedly agreed to import more liquefied natural gas from the U.S.

“They’re going to be a very, very big buyer,” Trump said. “We’re going to make it much easier for them, but they’re going to be a massive buyer of LNG, so they’ll be able to diversify their energy supply, which they very much want to do.”

The U.S. and E.U. agreed to launch a dialogue on standards to ease trade, reduce bureaucratic obstacles and slash costs dramatically.

They’ll aim to work closely together to reform the World Trade Organization (WTO) and “to address unfair trading practices, including intellectual property theft, forced technology transfer, industrial subsidies, distortions created by state-owned enterprises and overcapacity.”

Juncker said as long as negotiations continue, the E.U. and U.S. will hold off on further tariffs and will reassess existing tariffs.

“This was a good, constructive meeting,” Juncker said.

The U.S. and E.U. will work better together for global security and prosperity, Trump said, and fight jointly against terrorism.

“The United States and the European Union together count for more than 830 million citizens and more than 50 percent of the global GDP,” Trump said. “In other words, together, we’re more than 50 percent of trade. If we team up, we can make our planet a better, more secure and more prosperous place.”

The announcement came a day after U.S. Secretary of Agriculture Sonny Perdue authorized up to $12 billion for three programs under the Commodity Credit Corporation to help farmers hurt by new tariffs and trade tensions with the EU, China, Mexico and Canada.

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