President Donald Trump met with European Commission President Jean-Claude Juncker at the White House on July 25. Trump said that he "hopes to work something out on a fair trade deal with Europe." Just a day prior to the meeting Trump tweeted about the negotiations.
The European Union is coming to Washington tomorrow to negotiate a deal on Trade. I have an idea for them. Both the U.S. and the E.U. drop all Tariffs, Barriers and Subsidies! That would finally be called Free Market and Fair Trade! Hope they do it, we are ready - but they won’t!
— Donald J. Trump (@realDonaldTrump) July 25, 2018
In mid-June, Trump threatened to impose a 20% tariff on car imports from the European Union (EU) via tweeting in an effort to push forward with his America First policy. In his tweet, the President also urged automakers to manufacture cars in America rather than relying on imports. The EU is one of America’s largest trading partners, accounting for $717.9 billion worth of goods trade in 2017. While U.S. exported $283 billion worth of goods from the EU, the imports stood at $434.6 billion, making the deficit $151.3 billion, according to the Census Bureau.
Based on the Tariffs and Trade Barriers long placed on the U.S. and it great companies and workers by the European Union, if these Tariffs and Barriers are not soon broken down and removed, we will be placing a 20% Tariff on all of their cars coming into the U.S. Build them here!
— Donald J. Trump (@realDonaldTrump) June 22, 2018
Shares of automakers like Ford (F) and General Motors (GM) plunged in the immediate aftermath of the June tweet though the stocks recovered by the end of the day's trade. The trade friction with Europe have followed close on the heels of the United States' barrage of tariffs against China, to which the Asian giant responded to by imposing its own set of tariffs on U.S. imports as well. As trade tensions escalate, stock markets in both countries are also taking a beating with investors on the edge.
Top Imports from EU
The top of the list for imports from across the Atlantic Ocean is pharmaceuticals. In 2017, the U.S. pharma imports from EU stood at $71 billion.
Motor vehicle-related imports at nearly $58 billion and accounted for 13.3% of all goods imports from the EU last year. This category includes cars, motor vehicle bodies and trailers and car parts.
Machinery, excluding electrical and computer equipment, was the third-largest component of EU imports for the U.S. at $51.9 billion. This category includes agricultural and industrial machinery as well as engines and turbines.
Top Exports to the EU
In 2017, United States’ largest export to the EU was aerospace products and parts at $39.5 billion. That was followed by computer and electronic parts, worth $33.6 billion, and pharmaceuticals and medicines worth $30.7 billion.
Top State Trade
In terms of the volume of trade, in 2017, California ranked highest in terms of trade volume with the EU, with goods trade worth $67.6 billion, closely followed by Texas with $60.3 billion. New York, New Jersey and Georgia came next in line with trade volumes of $51.9 billion, $40.8 billion and $34.6 billion respectively. Wyoming, South Dakota and Hawaii are states that saw the lowest volume of trade with the EU last year.
Since pharmaceuticals and medicines made up for such a large chunk of imports, it isn’t surprising that New Jersey that is home to many pharma companies led the table with the highest trade deficit with the EU among states in 2017. NJ imports exceeded exports by $22.3 billion. It was followed by Georgia with a deficit of $19.3 billion, New York with $13.8 billion and Tennessee with $11.8 billion.