Commerce Secretary says deal still possible but tariffs are coming
U.S. Commerce Secretary Howard Lutnick reaffirmed on Sunday that the Biden administration is pushing forward with a hard deadline of August 1 for sweeping new tariffs on imports from the European Union and Mexico. The move follows stalled trade negotiations and a warning from President Donald Trump that tariffs ranging from 20% to 50% will take effect if no deal is reached by then.
Lutnick said in a television interview that the U.S. is still optimistic a deal with the European Union can be secured in time. “I just got off the phone with European trade negotiators — there’s plenty of room for agreement,” he said. However, he made it clear that the tariff implementation date is non-negotiable. “Nothing stops countries from talking to us after August 1, but they’re going to start paying the tariffs on August 1.”
Trump’s tariff letter escalates trade tensions
On July 12, Trump sent formal letters to key global trade partners including European Commission President Ursula von der Leyen, outlining plans for new blanket tariffs. The proposals include a 30% tariff on EU and Mexican imports, a 50% tariff on copper, and additional duties of 20% to 50% on various goods from Japan, Brazil, and Canada. The letters signal a return to aggressive protectionist trade policy amid growing frustration over stalled negotiations.
The tariffs are intended to pressure trading partners into agreeing to revised trade terms. While officials continue to explore options for compromise, Trump has shown no signs of delaying the action, even amid concerns from international trade groups and domestic importers.
USMCA in the spotlight for future talks
Despite the current tensions, Lutnick hinted at longer-term plans for reshaping U.S. trade relations across North America. He confirmed that Trump is expected to renegotiate the United States-Mexico-Canada Agreement (USMCA), which was originally signed during his first presidential term between 2017 and 2021.
For now, goods deemed compliant under the current USMCA framework will remain exempt from the upcoming tariffs. “I think the president is absolutely going to renegotiate USMCA, but that’s a year from today,” Lutnick said, suggesting a phased approach to broader trade reforms in the region.
Global economic implications loom
The looming tariff deadline has rattled markets and raised concerns about a potential escalation of global trade disputes. Europe and Mexico are among the United States’ largest trading partners, and any retaliatory measures could disrupt global supply chains, particularly in the automotive, agricultural, and metals sectors.
As the clock ticks toward August 1, both allies and U.S. industries are bracing for impact. Analysts warn that even temporary tariff impositions could introduce cost pressures and inflation risks across a range of consumer goods. Whether the administration can secure last-minute deals or whether a new wave of tariffs reshapes the global trade landscape remains to be seen.
