Paris (France) (AFP) – G7 trade ministers opened a meeting in Paris on Tuesday to discuss issues including critical minerals, but were not expected to directly address the latest US threat to impose additional tariffs on European vehicles. The meeting, set to last until Wednesday, is taking place as the Middle East war has upended the global economy with the closure of the Strait of Hormuz, through which a fifth of the world’s oil normally flows.
President Donald Trump’s threat last Friday that he will hike US tariffs on cars and trucks from the European Union will likely be addressed separately. The United States and European Union struck a deal last summer to cap US tariffs on EU autos and parts at 15 percent, which is lower than the 25-percent duty Trump imposed on many other trading partners. In late March, EU lawmakers gave their green light to the deal with Trump, but with conditions. It must still be approved by member countries.
Accusing the EU of failing to comply with the deal, Trump said Friday he would hike vehicle tariffs in response. The office of France’s junior trade minister Nicolas Forissier said earlier this week that Europeans would discuss Trump’s threat, but “not within the framework of the G7”. US Trade Representative Jamieson Greer was expected to meet with EU Trade Commissioner Maros Sefcovic in the French capital. They also have a meeting scheduled with French Economy Minister Roland Lescure.
At an informal session hosted by France’s business community on Tuesday, Greer in a video said the United States viewed “trade policy primarily as domestic policy.” “The United States is taking action unilaterally, but also together with willing partners,” he said. “We view the priorities that France is pursuing as G7 host this year as complementary to US efforts on trade,” he added.
On Wednesday, the trade ministers of the G7 (Britain, Canada, France, Germany, Italy, Japan and the United States) are expected to discuss the four priorities set by the group’s French presidency.
– Four priorities –
The first is to find a collective and effective response to industrial overcapacity that undermines free trade. Even if the discussion doesn’t formally target China, the country’s subsidizing of certain sectors has created trade tensions for years. A second priority is economic security, in particular securing and diversifying supplies of critical minerals that are indispensable in producing strategic products such as computer chips, electric vehicle batteries, and super magnets. France favors creating a system of groups of producing, processing, and consuming nations that share a commitment to implementing good practices.
The ministers will also touch on the failure in March of the latest round of World Trade Organization negotiations, with the body’s role as a trade referee having been paralyzed by the United States for years. “The goal is for this organization to be better suited to current challenges,” Forissier’s office said.
The ministers will also discuss cross-border sales via e-commerce sites, which have generated huge volumes of small parcels that escaped customs duties and posed unfair competition to local retailers. The United States last year suspended the tariff exemption on small parcels valued at less than $800, and the EU will this summer put in place a flat-rate customs duty on packages valued at under 150 euros ($175).
The summit of Group of Seven heads of state and government is scheduled for June 15 to 17 in the eastern town Evian, along the shore of Lake Geneva.
© 2024 AFP
