European Union flags are seen outside the EU Commission headquarters in Brussels, Belgium. Picture: REUTERS/FRANCOIS LENOIR
European Union flags are seen outside the EU Commission headquarters in Brussels, Belgium. Picture: REUTERS/FRANCOIS LENOIR

Washington  — European Union (EU) member states should brace for US tariffs on several fronts in the coming months, a senior German official said late on Tuesday, following meetings with US officials and legislators in Washington.

Peter Beyer, Germany's coordinator of transatlantic cooperation, said there was continued US interest in dialogue with Europe, but the Trump administration appeared poised to impose tariffs over disputes about aircraft subsidies, the Nordstream 2 gas pipeline and European car imports.

President Donald Trump said in May some imported vehicles and parts posed a national security threat, but postponed a decision for as long as six months on imposing tariffs on European and Japanese auto imports to allow time for trade talks with both partners.

European officials fear that Trump will now turn his attention to Europe, after brokering a truce in a protracted trade battle with China. The issue will be high on the agenda when German economy minister Peter Altmaier visits Washington this week.

Beyer, who met with officials from the US trade representative's office and the White House, as well as US legislators, said the car tariffs were likely in mid-November, given growing US impatience with the European Union and its refusal to include agriculture in broader trade talks.

"When it comes to the car tariffs, I unfortunately think they are more likely than not to be imposed in mid-November. There is quite a lot of impatience on the US side. But that also requires us on the European side to be strong and unified."

Aircraft subsidies

Beyer said the US government appeared interested in resolving a series of disputes between the US and the EU before the World Trade Organisation (WTO) over aircraft subsidies, but was unlikely to refrain from imposing tariffs in the interim.

"The WTO arbitrator decision is expected soon, as early as next week. I fully expect the Trump administration to impose tariffs. The US side feels entitled to impose the tariffs and I believe they will, in any case," he said.

The Geneva-based WTO has found that US-based Boeing and Europe's Airbus, the world's two largest planemakers, have received billions of dollars of harmful or illegal government subsidies to gain advantage in the global jet business.

The US  and EU have each threatened to impose billions of dollars of tit-for-tat tariffs, with Washington first in line to seek tariffs under the WTO timetable.

The WTO arbitrator is due to decide how much of the $11.2bn in tariffs proposed by Washington can be applied.

The EU earlier in July  said it was open to talks with Washington in the dispute, but no formal talks have begun, according to sources familiar with the issue.

Beyer said he told US officials that he did not view imposing tariffs ahead of any such settlement talks "as a great way to build confidence in that process".

European companies could also face sanctions as early as August or September over US objections about Russia's Nord Stream 2 natural gas pipeline project, Beyer said.

The 1,225km pipeline project to ship gas from Russia under the Baltic Sea to Germany drawn US objections on security grounds and divided the European Union.

Nord Stream 2 is led by Russian state gas producer Gazprom, with 50% of the funding provided by Germany's Uniper and BASF's Wintershall unit, Anglo-Dutch firm Shell, Austria's OMV and France's Engie .

Eastern European, Nordic and Baltic Sea countries see the pipeline as increasing Moscow’s economic grip on Europe. But many politicians and energy companies in Germany support Nord Stream 2 as a way to ensure steady gas supplies as Europe's largest economy weans itself off of coal and nuclear power.

US energy secretary Rick Perry in May said a sanctions bill putting onerous restrictions on companies involved in the project would come in the "not too distant future".

Washington fears the pipeline will increase the EU's reliance on Russian gas.

Reuters