US President Biden and EU Commission President Van der Leyen spoke in Rome about a “significant breakthrough” and a “milestone”.
Under US President Trump, the goal of world trade is “eye for an eye, tooth for a tooth”. Trump imposed taxes in 2018 against several countries in order to buy more foreign products in the United States because the United States imports more than it exports.
China and the European Union were hit by tariffs on steel and aluminum. In response, the EU taxed American goods – from bourbon whiskey to peanut butter to Harley-Davidson motorcycles.
Like under Joe Biden, “If you help me, I will help you”. According to Peter van den Bosse, a world trade expert at the Bern World Trade Institute, Biden’s team thinks differently than Trump. It is approaching the EU again. This summer, the EU and the USA settled a 17-year dispute over subsidies for their respective aircraft manufacturers, Airbus and Boeing.
Myth:
Joe Biden and Ursula van der Leyen at G20 summit: US and EU are getting closer economically
Reuters
The steel controversy is still unresolved. Van den Bosche explains that this was originally a ceasefire and that negotiations are now resuming. For now, the United States will now reduce steel tariffs, in return for the EU avoiding doubling tariffs on U.S. goods, which it initially threatened.
Two winners, did China lose?
According to experts, the agreement between the EU and the United States is not good news for China. Peter van den Bose said the United States and the European Union seemed to be working together to challenge China. He himself was active in the WTO dispute resolution panels.
However, if two major players form an alliance against a third major, this would not be a good signal for prosperous world trade: after all, the WTO and its dispute resolution mechanisms are precisely such controversies. You need to make sure that the law of the strong alone does not succeed.
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