President Donald Trump‘s meeting with European Commission President Jean-Claude Juncker on Wednesday was expected to be contentious, coming less than two weeks after the former called the EU a “foe” that “clobbered” the U.S. on trade.
Instead, the two leaders apparently called a truce, agreeing to put trade war escalations on hold while they work toward zero tariffs, zero barriers and zero subsidies on all non-auto industrial goods, they said in a joint statement following the meeting. As part of the deal, the EU has agreed to buy more soybeans and liquid natural gas from the U.S., while the States will presumably stop threatening additional tariffs on European automobiles.
But while the announcement seems to talk back Trump’s tweet from Tuesday that “tariffs are the greatest,” achieving the goal of free and fair trade will require significant negotiations and eventually congressional approval. Similar negotiations were already underway for several years as part of the Transatlantic Trade and Investment Partnership during the Obama administration; however, they were halted indefinitely in late 2016.
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As for the footwear industry, Wednesday’s agreement won’t result in any major changes immediately, but some say it’s a glimmer of hope that more trade-positive actions may be on the horizon.
“For the longest time now, we’ve had nothing but story after story and announcement after announcement that has been protectionist in nature and disruptive to the economy and all the things that we assign to building economic walls that impact and hurt American consumers,” Matt Priest, president and CEO of the Footwear Distributors & Retailers of America, told FN. “So to have an announcement that two very large economies, the European Union and the U.S., are going to move toward zero duties, zero-tariff and non-tariff barriers and try to streamline regulatory challenges between the two trading bodies, I think is a positive thing.”
He also pointed out that the footwear industry is well-accustomed to the effects of tariffs, since it’s already one of the most heavily taxed categories coming into the U.S.
“We’re kind of the poster child for duties and the negative impact duties play on an industry … We paid $1.5 billion in duties on Chinese footwear last year alone. So we’re used to paying detrimental duties and taxes on imports — it’s something we’ve done for a long time,” he said.