Senior German politician expects more talks in EU tariff dispute with Trump

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ZURICH (Reuters) -A senior German politician said on Sunday the European Union and Washington could negotiate further and postpone higher import duties after U.S. President Donald Trump ramped up the trade war by threatening a hike in tariffs on the bloc.

“The negotiating poker game between the EU and the U.S. is entering its decisive phase,” Juergen Hardt, deputy leader of Chancellor Friedrich Merz’s conservative CDU/CSU parliamentary group in the Bundestag, told Reuters.

“I’m betting that at least a partial agreement and a further postponement will be reached before August 1. After all, high tariffs have to be paid by American citizens and companies and lead to higher prices and inflation in the U.S.,” he said.

Trump on Saturday threatened to impose a 30% tariff on imports from Mexico and the EU from August 1, after weeks of negotiations with the major U.S. trading partners failed to reach a comprehensive trade deal.

He originally imposed a duty of 20% on EU goods in April, but this later was suspended for 90 days and replaced with a baseline tariff of 10%.

Last week he pushed back the deadline for negotiations to August 1. This was separate from sector tariffs covering steel, aluminium and car imports from the EU to the U.S.

Europe has to dissuade Trump from his “mistaken belief” that the U.S. trade deficit is caused by protectionist measures by the EU, Hardt said.

The U.S. has a surplus in services due to the dominance of its IT sector, he said, which helped offset the trade deficit to large extent.

“Americans are so much wealthier than other nations that they can afford to make the rest of the world work for them in an economic sense,” Hardt said.

“Fewer imports mean that the USA would have to work more and harder to maintain its prosperity. Whether this is the fervent wish of the American people remains questionable.”

(Reporting by Andreas Rinke, writing by John Revill, editing by Clelia Oziel)