US moves toward another tariff delay; could slide to 1 August

Brussels – And yet, holding their breath, the Europeans seem to have bought some time on the crucial issue of US tariffs. The deadline for reaching an understanding with the White House, initially set for 9 July, was postponed to 1 August, giving more time for negotiations between the two sides of the Atlantic. However, on this side of the ocean, the 27 member states are still divided over the approach to take in dealing with Donald Trump and his threats.

The announcement came yesterday (6 July) from US Treasury Secretary Scott Bessent, during an interview with CNN. He confirmed that Donald Trump “will send letters to some of our trading partners saying that if you don’t move along,  on 1 August you will go back to the 2 April level,” the so-called Liberation Day when the president imposed “reciprocal tariffs” on almost every country in the world (including islands inhabited exclusively by penguins). At the end of May, the tycoon had set the deadline on 9 July, meeting the demands of Ursula von der Leyen, for whom the initial 1 June deadline was too close. 

The US Treasury Secretary was keen to emphasise that “this is not a new deadline,” even though there is, in fact, a further three-week delay. The strategy, he argues, is to exert “maximum pressure” on trading partners. And he cites the case of the EU as an example to demonstrate the soundness of this tactic: after an uncertain start to the negotiations, he noted, the Europeans “are making very good progress.”

It is unclear at the moment whether Maroš Šefčovič, the EU Trade Commissioner, has yet requested another extension after flying to the United States last week in an attempt to close the deal, but without success. Nor is it clear where the negotiations between Brussels and Washington stand. Šefčovič signalled the EU executive’s willingness to accept a “flat” 10 percent tariff for all products (to be accompanied by exemptions on specific sectors). Still, in recent days, the figure of 17 percent has been circulated, endorsed by Trump himself as a basic tariff measure. 

Von der Leyen — who spoke with the tycoon on the phone yesterday — and her commissioners reiterated the hope for a beneficial understanding for both sides, but always left open the door to legal and commercial retaliation, should European interests be put at risk. “The work is ongoing at the political level and different technical levels” keeping the 9 July horizon, a Berlaymont spokesman commented this morning, denying having received any letters from the White House. With Eurostat data in hand, the value of EU-US trade in goods and services in 2024 totaled approximately 1,700 billion euros.

Be that as it may, the time gained will have to be used by the Europeans to find a way forward, as the 27 member states are still deeply divided on the line to follow. Trade is one of the exclusive competences delegated by national governments to the Commission, which negotiates on behalf of the whole Union but must, in fact, obtain an explicit political mandate.

The most export-dependent Member States, such as Germany, Ireland, Italy, and Hungary, are willing to make more concessions to the US to avoid the implementation of increased tariffs. On the other hand, countries such as France and Spain would like to hold out in the tug-of-war with Trump and negotiate more advantageous terms for the Old Continent. On this front, Trump’s strategy to divide and conquer has worked perfectly.

Bessent described the conclusion of “several agreements very quickly” as imminent. “I expect several important announcements in the coming days,” he said, but without mentioning any countries specifically. To date, the only agreements concluded are those with the United Kingdom and Vietnam, while a truce with China appears to be back in force.

However, just in the last few hours, Trump lashed out against Beijing, warning the entire globe that Washington will impose 10 percent additional tariffs on anyone who “aligns” with the BRICS+ (Brazil, Russia, China, India, South Africa, plus Egypt, the United Arab Emirates, Ethiopia, Indonesia, and Iran), branding the group’s economic policies as “anti-American.”