Trump and European Union chief Jean-Claude Juncker agree to ease trade tensions

Trump and European Union chief Jean-Claude Juncker agree to ease trade tensions

United States president Donald Trump has accused China of "vicious" tactics on trade as he prepares for tough negotiations with European leaders in an escalating trade battle among world powers. The administration recently announced a $12 billion temporary aid package for farmers - including soybean producers - dealing with the impact of retaliatory tariffs.

Instead of retaliatory tariffs, the correct Chinese response would be to stop their bad behavior. "It's progress. To have the temperature lowered with our European trading partners and allies is smart".

Trump said. "Hope they do it, we are ready - but they won't!" he said.

He said officials from both sides would immediately focus on steel and aluminum tariffs first "so that there can be no tariffs in either direction", and he expected that issue to be resolved "very quickly".

Earlier in the Oval Office, Juncker told Trump that the two trading partners were "allies, not enemies" and said they needed to work together to address recent frictions involving Trump's threats to impose tariffs on auto imports and European Union plans to retaliate.

"While we are working on this, we will not go against the spirit of this agreement unless either party terminates the negotiation", he said in a joint press conference with Juncker.

Chinese President Xi Jinping said at an global summit in South Africa that the world faces "a choice between cooperation and confrontation", in remarks that criticised escalating U.S. tariffs on goods from China and other major trading partners.

And to some European eyes, the more feasible parts of what Trump and Juncker discussed look a lot like the goals of what was known as the Transatlantic Trade and Investment Partnership, an initiative begun under President Barack Obama that aspired to free trade with Europe. The daily reports that the European Union leaders had agreed to this move back in May, even though USA gas is as much as 20% more expensive than Russian gas delivered to the EU. The Europeans also agreed to import more US soybeans.

He increased the interest by arresting tariffs on steel and aluminum, encouraging reprisal procedures by the European Union. He suggested they're being used as negotiation leverage for better trade deals.

Trump repeated his call for "reciprocal" trade.

The United States earlier this month imposed 25 percent tariffs on $34 billion worth of Chinese products, drawing a tit-for-tat response from Beijing which targeted politically sensitive USA agricultural products. Trump has threatened 20 percent to 25 percent tariffs on imported vehicles and auto parts, which he has labeled a threat to America's national security.

Mnuchin said there were no new developments on the dispute with China, which has been the target of most of Trump's trade policies.

The Dow Jones Industrial Average jumped on the news, which was regarded by analysts as a victory for Trump's strategy of using tariffs and tweets to level the trading field for the U.S.