BRUSSELS — Late at night, after a dinner of dumplings and duck legs, the European Union’s leadership excitedly revealed a new plan to combat the hell-raising American president’s trade war: Take him on at his own wild game.
For six months, Donald Trump has upended the global trading order, threatening and announcing tariffs, then easing them to open negotiations, while warning that punitive levies will be reimposed if the terms are not to his liking.
With just 13 days until the Trump-imposed deadline to conclude a EU-U.S. deal, European Commission President Ursula von der Leyen decided the time for conventional negotiating tactics was over.
She floated the idea that the EU’s 27 countries could join forces with 12 members of the Asian-led Comprehensive and Progressive Agreement for Trans-Pacific Partnership bloc (CPTPP) — which now includes the U.K. — to form a new world trade initiative.
The new grouping would redesign a rules-based global trading order, reforming or perhaps even replacing the now largely defunct World Trade Organization, she said.
Crucially, the U.S. would not automatically be invited.
Such a plan would “show to the world that free trade with a large number of countries is possible on a rules-based foundation,” von der Leyen said at the end of the EU leaders’ summit in Brussels in the early hours of Friday morning. “This is a project where I think we should really engage on, because CPTPP and the European Union is mighty.”
Von der Leyen then explained that it would be up to the EU and the CPTPP to decide whether the U.S. would be allowed to join their project. “As far as I understand, the Americans left at a certain point.”
Innovative and unpredictable
The idea of more formal cooperation with the Indo-Pacific group had already been floated in recent months by the EU executive as a way to counter Trump’s tariffs. But in case there was any doubt that such a gambit was firmly tied to fighting back against Trump’s disruption, another man called Donald dispelled it.
Polish Prime Minister Donald Tusk revealed the bloc had to be “very innovative … sometimes maybe unpredictable — as our friends from the other side of Atlantic.”
Poland currently holds the six-month rotating presidency of the Council of the EU. And Tusk, a former European Council president, is a veteran of Brexit negotiations, having chaired late-night summits in Brussels in an attempt to get a deal with the U.K. on its divorce from the bloc. He couldn’t resist crowing about giving Trump a taste of his own medicine.
“I think all of us are aware about this new method how to negotiate and how to talk about trade and other communications,” Tusk said, clearly referring to Trump’s disruptive tactics. The U.S. is one of Europe’s closest partners, he noted, “but we need to be similar to our partners in some sense.”
Von der Leyen’s idea won public endorsement from Europe’s most powerful leader, German Chancellor Friedrich Merz. “If the WTO is as dysfunctional as it has been for years and apparently remains so, then we, who continue to consider free trade important, must come up with something else,” he said.
But the truth is, von der Leyen’s proposal may ultimately prove only a temporary distraction from what threatens to be a major defeat, when an agreement with Trump is finally unveiled.
At the summit, European leaders grimly digested the news of a fresh proposal from the U.S. for further negotiations, POLITICO was first to reveal.
Punitive tariffs
As they sat around the dinner table and accepted they won’t get a great agreement from Trump, they asked each other just how bad a deal they would be prepared to take to avoid the worst of his tariffs.
Von der Leyen and her team are now expected to negotiate a sketchy outline of a contract in the next few days to meet Trump’s deadline of agreeing terms by July 9. After that date, he has threatened to ramp up punitive tariffs on EU goods to as high as 50 percent.
Only a month ago, EU countries were bullish about pushing Trump to back down in his trade war. They scorned the outline agreement the U.S. president struck with U.K. Prime Minister Keir Starmer, insisting the bloc was a trading superpower and would never accept Trump’s baseline 10 percent tariff.
Now, all that has changed. “It would be best to have the lowest tariff possible, 0 percent is the best,” said French President Emmanuel Macron. “But if it’s 10 percent, it’ll be 10 percent.”
Lithuania’s President Gitanas Nausėda told POLITICO the EU can at most “hope to be treated like the United Kingdom” when it comes to a trade agreement with the U.S.
“It would probably be the best scenario,” Nausėda said. “But the United Kingdom, in the eyes of the United States, it’s a little bit different as a partner. And I hope we will be treated like the United Kingdom — but we will see.”
Diplomats said the question facing EU leaders was whether to go for a quick deal in the next two weeks or wait for a better one, even if it means a protracted trade war with the U.S.
The risk in that situation would be that Trump then revisits his commitments to European defense, asking why Americans should pay to protect countries that are fighting them on trade, one diplomat said, speaking on condition of anonymity because the matter is sensitive.
Germany’s Merz was the strongest voice in favor of a rapid deal, even if it is only an outline. “We now have less than two weeks until July 9. And you can’t agree a sophisticated trade agreement there,” he said. Industries from chemicals, to steel, to car-making are already suffering, he said, putting companies at risk. “Please let’s find a solution quickly.”
Hans von der Burchard, Jacopo Barigazzi, Yurii Stasiuk, Ben Munster, Gregorio Sorgi, Hugo Murphy, Louise Guillot, Nicholas Vinocur, Sarah Wheaton, Max Griera and Alexander Varbanov contributed reporting.
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