The European Union is preparing to halt the ratification process for the EU-US trade deal after US President Donald Trump threatened to impose new tariffs on Greenland.
Manfred Weber, leader of the European People’s Party (EPP), the European Parliament’s largest political group, said progress towards a deal was impossible under the current circumstances.
Weber said in a social media post on Saturday that the EPP supports the EU-US trade deal in principle, but approval is not possible at this stage due to Trump’s threats regarding Greenland. Weber also argued that the EU’s promise to cut tariffs on American goods should be suspended.
The trade deal in question was shaped by an agreement reached last summer between European Commission President Ursula von der Leyen and Mr. Trump. Parts of the agreement have begun to be implemented, but it still needs approval from the European Parliament before it can fully enter into force. It has been said that if EPP lawmakers join forces with left-wing groups, they could secure a majority sufficient to delay or completely block a deal.
Under the agreement, the U.S. would impose 15% tariffs on most EU-originated goods, while the EU would eliminate tariffs on U.S. industrial products and some agricultural products. Von der Leyen had brokered the deal to avoid a full-blown trade war with the Trump administration. However, many EU lawmakers argued that the deal was unbalanced in favor of the United States. The criticism intensified after the United States extended the 50% tariffs it had already imposed on steel and aluminum to hundreds of additional EU products after the July deal.
Last month, U.S. Trade Representative Jamieson Greer criticized the EU for not implementing some provisions of the deal, particularly regarding regulations targeting technology companies.
President Trump announced yesterday that starting February 1, he will impose an additional 10% tariff on products imported from European countries that support Greenland. Trump said the tax rate could rise to 25% “until we reach an agreement on the full and final purchase of Greenland.” The announcement was met with strong criticism in European capitals.
Von der Leyen said the tariffs would “undermine transatlantic relations and increase the risk of a dangerous downward spiral,” while French President Emmanuel Macron said Trump’s threats were “unacceptable.”
Bernd Lange, President of the European Parliament’s Trade Committee, also said that respect for national sovereignty is a fundamental condition for trade agreements. In response to President Trump’s comments, Lange said work on implementing trade agreements with the United States should be halted until the threat is removed. He also called on the EU to use “anti-coercion instruments” (ACI), which have never been used before, if necessary.
*This is not investment advice.
