{"text":[[{"start":7.5,"text":"Donald Trump’s “liberation day” tariff onslaught is fast approaching, all over again. The president’s “reciprocal” tariffs, which were paused in April after markets reacted negatively, are supposed to come into force on August 1 for countries that fail to strike trade deals with Washington. As it stands, that is the case for the vast majority of America’s trade partners — chief among them the EU, the biggest partner of all."}],[{"start":37.83,"text":"The August 1 deadline will test the complacency that has prevailed in financial markets since Trump’s partial retreat in April, which still left in place a baseline tariff of 10 per cent plus higher levies on cars and steel. It is also a moment of truth for the EU, which must decide quickly how hard it is prepared to hit back if talks fail. Trump is in no hurry to cut a deal with a trading bloc he seems to despise. Earlier this month, when officials on both sides of the Atlantic could discern a landing zone for agreement, the president upped the ante, raising the threatened reciprocal tariff from 20 to 30 per cent. And, as the FT reported last week, just as European negotiators resigned themselves to his 10 per cent baseline tariff, Trump demanded 15 or 20 per cent."}],[{"start":95.43,"text":"The EU has struggled to present a consistent strategy. The European Commission initially stood firm against the 10 per cent baseline. But after the UK secured an agreement, Germany and other member states wobbled and pushed for a similar deal. With Trump now playing hardball, Berlin appears to favour a tougher stance."}],[{"start":119.18,"text":"The EU’s biggest error has been to think it could negotiate a conventional, mutually beneficial trade arrangement, even one that left US tariffs higher than those in the EU. The UK swallowed Trump’s 10 per cent baseline even though it has a goods trade deficit with the US. With its huge surplus, the EU was never going to win a deal on similar terms. Yet the commission itself has been reluctant to talk up resistance."}],[{"start":149.82,"text":"The commission has lined up some €93bn in retaliatory tariffs. It now needs to show it is willing to open up its extensive armoury of non-tariff instruments, showing the full range of weapons at its disposal. The EU’s new Anti-Coercion Instrument, for example, gives Brussels multiple options for hitting back. It could start with targeted measures that minimise pain to Europe, such as excluding US companies from public procurement, suspending equivalent regulatory treatment of US financial firms or taxing advertising revenues of US tech giants. It should also threaten to go much further if needed. These actions will help build constituencies in America that see the cost of Trump’s trade folly, just as the retaliatory threats of Canada and Mexico have done."}],[{"start":206.22,"text":"Trump will surely retaliate. But his escalatory dominance is not what it was. His threatened 30 per cent tariffs would pretty much freeze trade, so going to 50 or 100 per cent carries less menace. More serious is the risk that he takes revenge by reneging on commitments to European security or to Ukraine. But an accord on Nato spending increases is in the bag while Trump’s recent rapprochement with Ukraine is driven by Russia’s snubbing of his peacemaking efforts, not generosity to Kyiv."}],[{"start":242.66,"text":"The EU’s biggest problem is corralling its member states behind an agreed course of action. Italy and some eastern flank countries remain reluctant to confront Trump. Having showed patience with them, the commission can now argue that good-faith negotiations with Washington have run their course. If the EU does not roll out its big guns now, they might as well not exist. Given Trump’s fickleness, the EU will need its trade weapons even if it somehow reaches an eleventh hour deal."}],[{"start":284.04,"text":""}]],"url":"https://audio.ftmailbox.cn/album/a_1753242773_4030.mp3"}