European lawmakers suspend U.S. trade deal amid Greenland tariffs
European lawmakers on Wednesday suspended approval of the trade deal the EU and the US agreed to in July.
Bernd Lange, a member of the European Parliament and INTA’s head of EU-US trade relations, said on Wednesday that President Donald Trump’s latest plans to impose tariffs of between 10 percent and 25 percent on European countries are contrary to the terms of the trade agreement.
Referring to Trump’s speech at the World Economic Forum in Davos on Wednesday, Lange said: “I think he hasn’t changed his position. He wants Greenland to become part of the United States as quickly as possible.”
In his speech, the president called for “immediate negotiations” on the purchase of Arctic lands.
In his speech, Trump rejected the use of military force; Lange described this commitment as “a small positive element.”
But Lange added that the proposed 10 percent to 25 percent tariffs would remain on the table and “there will be no possibility of compromise” until the threat of them is over.
“We will continue the procedure until there is clarity about Greenland and the threats,” he said.
“President Trump broke the Scotland deal,” Lange said, referring to the trade deal agreed between the EU and the US at Trump’s Turnberry golf resort last year.
Lange said Trump “used tariffs as a tool of political pressure” as a way to buy Greenland, calling the move “an attack on the economic and territorial sovereignty of the European Union.”
He added that the International Trade Committee will on Monday discuss the use of the EU’s Anti-Coercion Instrument (ACI), a far-reaching measure variously described as a “trade bazooka” that would allow the EU to significantly restrict US companies’ access to its single market, prevent them from participating in tenders, reduce the flow of goods and capital and rein in foreign direct investment into the bloc.
“This is exactly what a foreign country was created for such a situation [uses] Lange said of ACI: “Tariffs and investments for political and coercive pressure.
Earlier in the day, Bundesbank chief Joachim Nagel told CNBC he hoped Trump would reverse his stance and called transatlantic tensions “a very problematic situation.”
Nagel, a member of the European Central Bank’s governing council, acknowledged that the tariff threat would likely “spill over some” into monetary policy in the region.
Speaking to CNBC’s Karen Tso at the World Economic Forum meeting in Davos on Wednesday, Nagel said the tariff dispute “maybe” could be a game changer for monetary policy in the euro zone and that it’s still “on a good track.”
“I still have hope that we can find a solution and a common understanding,” Nagel added.
