EU Dangles €50B Trade Carrot in Front of Trump—Because Nothing Says ’Diplomacy’ Like a Giant Pile of Cash

Brussels plays high-stakes poker with a trade offer fat enough to make even Wall Street blush.

Subheader: The Art of the Deal—Euro Edition

Forget backroom handshakes—the EU just slapped a €50 billion trade package on the table like a crypto whale dumping bags. Will Trump bite, or is this just another IOU in the geopolitical Ponzi scheme?

Closer: In a world where ’free trade’ often means ’free money for lobbyists,’ at least the EU kept the receipt.

The EU’s strategic offer

According to Maroš Šefčovič, the EU’s trade commissioner, the European Union is proposing a €50B increase in purchases of U.S. goods.

The €50B investment is aimed at easing the growing trade tensions with Washington. Šefčovič told the Financial Times that the EU is making “certain progress” in its negotiations with the U.S. The EU however made it clear that it will not accept the 10% tariff recently imposed by President Donald Trump as a fair outcome.

The proposal will also help to close what the U.S. perceives as a €50B trade deficit with Europe. Šefčovič stated this trade gap could be quickly closed if Europe increased its imports of American goods such as its liquefied natural gas (LNG), soybeans, and other agricultural products.

“If what we are looking at as a problem in the deficit is €50B, I believe that we can really solve this problem very quickly,” he said.

The bloc has been working to prevent a full-blown transatlantic trade war since Trump’s announcement of a 10% tariff on most countries on April 2. The U.S. government also proposed a 20% “reciprocal” tariff for the EU.

The extra 20% tariffs were eventually suspended to allow 90 days for negotiation, but the initial 10% tariff remains in place, and further duties could be added on in July if no agreement is reached between the nations.

Šefčovič explained that the EU is working on a deal that is “balanced and fair,” not one that locks in high tariffs.

“It will be very difficult to reach a deal that is clearly good and acceptable for our member states and our European parliament,” he said.

Retaliatory measures are still on the table

The EU has so far embraced diplomacy during the trade talks, but the bloc did not neglect preparing for the worst.

The European Commission, the agency responsible for negotiating trade deals on behalf of the EU’s 27 member states, has outlined both incentives for a deal and retaliatory measures in the event that negotiations fall through.

On the topic of retaliatory measures, the EU has a €21B retaliatory tariff package ready for American goods such as Harley-Davidson motorcycles, poultry, and clothing. The tariff is currently paused until July 14.

“We will be working meticulously with every member state to have a robust response, which would have unanimous support,” Šefčovič said.

The Commission recently briefed its ambassadors on both negotiation tactics like carrots and sticks in a bid to prepare the bloc for any outcome.

Šefčovič emphasized that while the EU is pushing for a resolution, it stands firm in rejecting tariffs it deems unfair. When he was asked directly if the EU would accept a 10% tariff baseline as a compromise, Šefčovič responded that such a level is “very high.”

The EU has shown that it is open to adjustments and carve-outs announced by the U.S. government. Adjustments include changes such as relief for the automotive sector. Šefčovič suggested that that was likely in response to warnings about a potential economic fallout.

Šefčovič also stated that the EU is open to cooperating with the U.S. on broader global trade challenges, including those related to China. He proposed working together to address issues like steel and aluminum overcapacity, semiconductor development, and reducing dependency on critical raw materials.

“We believe that we can actually achieve a lot together,” Šefčovič said.

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