{"id":34021,"title":"The EU Must Steel Itself Ahead of 2024 U.S. Elections","link":"https:\/\/bst-europe.eu\/de\/europe-in-the-world\/the-eu-must-steel-itself-ahead-of-2024-u-s-elections\/","date":"15. Januar 2024","date_unix":1705335868,"date_modified_unix":1747997257,"date_iso":"2024-01-15T16:24:28+00:00","content":"

As 2023 came to a close, the United States and the European Union reached yet another interim deal<\/a> to forgo their longstanding dispute over the Trump-era steel and aluminum tariffs<\/a> through 2025. This short-term deal is a blow for transatlantic trade relations \u2013 because it is no more than a short-term fix, a far cry from the, now delayed, Global Agreement on Sustainable Steel and Aluminum (GSA). The GSA would have alleviated this bilateral trade irritant and allowed both sides to jointly address unfair trade practices in these critical input materials toward China<\/a>.<\/p>\n

However, even if a deal on GSA had been reached, would both sides really be in a different position than they are now?<\/p>\n

As the primary and caucus season of this year\u2019s U.S. election kicks off in Iowa, the reality is that a potential Republican administration entering office in 2025 could undo this deal in short order \u2013 and cause further disruptions to the EU far beyond what occurred during Trump\u2019s presidency.<\/p>\n

Today, Trump\u2019s campaign speeches and strategic documents<\/a> released by right-wing U.S. think tanks scoping a Republican agenda outline an aggressively isolationist trade policy should Trump return to the White House. Thus, the EU must be prepared for all scenarios, with just a year to steel itself and preserve its trade advantages.<\/p>\n

Another extension, another blow to transatlantic trade relations<\/strong><\/h2>\n

In 2021, the Europeans reluctantly agreed to replace the Section 232 tariffs with a quotas-based system, with the understanding that a bigger and better deal would be reached in two years\u2019 time. No such deal has emerged. A two-month extension was struck at the October EU-U.S. Summit, and yet again, another extension has been (reluctantly) announced through 2025.<\/p>\n

The Europeans\u2019 logic is simple: the tariffs, which they view as incompatible with WTO<\/a> standards, should not be replaced but rather removed completely. Extending this unbalanced quota-based arrangement, which was meant as an entry ticket for more substantial negotiations, is a bitter pill to swallow.<\/p>\n

Transatlantic trade relations seemed to be picking up momentum through fall 2023 as the EU-U.S. Summit neared \u2013 and then quickly slowed: Stasis in the negotiation of the GSA must be read as a failure.<\/p>\n

What Europe could face from the U.S. starting in January 2025<\/strong><\/h2>\n

In the event that former President Donald Trump is reelected, Europe could not only say goodbye to the prospects of the GSA but would experience a sharp reversal in transatlantic trade relations, far beyond the simple reintroduction of Section 232 tariffs. As current plans stand, the U.S. would abandon or severely weaken international trade organizations and pursue an aggressive, unilateral trade policy, particularly towards China. The EU would, in turn, be pressured to fall in line.<\/p>\n

The recent U.S.-EU interim quota deal exemplifies the limits of a \u2018Europe-friendly\u2019 administration. The erratic nature of a Trump 2.0, characterized by an aggressive, protectionist trade policy rooted in national security, would be unlike anything Europe has experienced thus far.<\/p>\n

The transatlantic long game starts now<\/strong><\/h2>\n

Considering these risks, policymakers, businesses, and civil society should start future-proofing EU-U.S. trade relations now. As relations become unpredictable, resilience should be built at other levels of society \u2013 from chambers of commerce to state and city-level government.<\/p>\n

Organized civil society, and especially trade unions, should explore their options for continued cooperation beyond 2025. Recent numbers<\/a> show that trade unions now have the approval of roughly two in three Americans, they are boosted by prominent successes in the auto industry, and membership is rising rapidly on both sides of the Atlantic. This is an opportunity to strengthen transatlantic cooperation on issues like global labor standards and technological disruptions, as well as a fair and inclusive green transition.<\/p>\n

By addressing these concerns and bringing stakeholders to the table, decision-makers could strengthen civil society as a pillar of transatlantic resilience. The Stakeholder Dialogues at the Transatlantic Trade and Technology Council (TTC) are a starting point for this exchange. However, if the TTC is either severely weakened or abolished under a new administration, stakeholders should prepare for a time when the responsibility for this facilitated dialogue falls on them.<\/p>\n

Europe must be prepared for all scenarios<\/strong><\/h2>\n

President Biden could secure a second term in November, introducing a new window for the EU and U.S. to push the GSA over the finish line. Even if an administration change occurs, the extent to which the Republican trade agenda could be implemented is unclear. Nonetheless, Europe should be prepared for the worst-case scenario.<\/p>\n

The EU should move beyond damage control and start by putting its own house in order: What are its vital trade interests, and what are the strengths it can use in its service? The EU should consider \u201cde-risking<\/a>\u201d by strengthening its relationships with other partners.<\/p>\n

At the same time, it should address the more fundamental questions facing its hands-off economic model amid geopolitical tensions and the immense investment needs for the green transition while also tackling long-standing issues in its still fragmented single market.<\/p>\n

Within this overall framework, defensive measures have a role to play. The EU should include potential out-of-the box solutions to bilateral disputes, but also contingency plans for failed negotiations \u2013 such as countermeasures under the EU\u2019s new Anti-Coercion Instrument<\/a>.<\/p>\n

The more developed these contingency plans are, the less likely it is that the instrument will need to be used \u2013 especially as the next European Commission may be confronted with the consequences of a U.S. administration change shortly after coming into office next autumn.<\/p>\n

If the election indeed fails to go Biden\u2019s way, the failure of GSA negotiations will be the least of Europeans\u2019 worries. The transatlantic relationship, in trade and beyond, would be placed under severe pressure, and Europe urgently needs to face this reality.<\/p>\n

By understanding the U.S. Republican party\u2019s trade policy objectives, strengthening EU-U.S. relations at other levels of government and society, and preparing for scenarios that could follow in nearly one year\u2019s time, the EU will be better placed to weather the storm that the 2024 U.S. elections could bring. The clock is ticking.<\/p>\n

This piece is a slightly adapted version of an <\/em>article<\/em><\/a> that featured in Euractiv on December 21st<\/sup>, 2023. <\/em><\/p>\n

About the authors<\/strong><\/p>\n

Brandon Bohrn works as a project manager in the Europe\u2019s Future program. His work centers around U.S.-German and transatlantic relations. Previously, he worked on the transatlantic team at the Bertelsmann Foundation in Washington, D.C.<\/p>\n

Etienne H\u00f6ra is a project manager in the \u2018Europe\u2019s Future\u2019 programme at Bertelsmann Stiftung. His focus lies on the EU\u2019s trade policy in this geoeconomic age, as well as the consequences of China\u2019s increasing assertiveness for the EU.<\/p>\n

Read More on EU-U.S. relations<\/strong><\/p>\n

The EU-U.S. Summit Falls Short of Expectations<\/a><\/p>\n

The Transatlantic Trade and Technology Council(TTC): EU-U.S. Cooperation in a Changing Geo-economic and Trade Environment<\/a><\/p>\n

New Transatlantic Foresights \u2013 What Do Experts Say on the TTC, the IRA, China, and Other Issues? <\/a><\/p>\n","excerpt":"

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