EU says US trade deal ‘within reach’ amid 15% tariff talks

A European Commission official said Thursday that the EU believes a trade deal with the United States is “within reach,” as diplomats suggested the two sides looked to be closer to an accord.

“As regards a deal as an outcome, we believe such an outcome is within reach,” EU trade spokesperson Olof Gill said.

Diplomats said on Wednesday that a US plan with a 15 percent baseline tariff rate was on the table, with carve-outs for industries like as pharmaceuticals and aviation, but it was still being discussed.

On Wednesday, top EU trade negotiator Maros Sefcovic spoke with US Commerce Secretary Howard Lutnick, while the US pointed to progress in talks between the two trading partners.

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“The EU continues to engage with the US intensively at technical and political level, and that’s all I can say for the moment,” Gill said, refusing to disclose more information about the two men’s call.

Although the commission – spearheading trade negotiations on behalf of the 27-country bloc – is focused on getting a deal, Brussels has insisted that the bloc will retaliate if talks fail.

“We are proceeding on twin tracks, negotiation and preparation for the event that the negotiations don’t lead to the outcome we want,” Gill said.

EU states earlier on Thursday approved a package of counter-tariffs of up to 30 percent on 93 billion euros ($109-billion) of US goods – that would take effect from August 7 if there is no accord.

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The commission is also separately preparing a list of US services – including tech and financial companies – to target with curbs should the negotiations disappoint.

It has, however, not yet submitted any draft plans to member states on that front.

Beyond that, France has led a charge to show the EU’s willingness to deploy a powerful trade weapon known as the anti-coercion instrument, which Gill described on Thursday as the commission’s “most powerful deterrent”.

The tool, which has never been used, allows the EU to take measures such as import and export restrictions on goods and services.