buy more liquefied gas and weapons

European leaders are staging a frenetic activity of preparations whose stated objective is minimize damage of the Republican’s return to the White House. For now, the EU has escaped the first attack of fury staged by Trump this week against Mexico, Canada and China. To the first two a general tariff of 25% from day 1 of his mandate, while for the Asian country he announces an additional 10% surcharge. A punishment for not doing enough in the fight against illegal immigration and drug trafficking.

In Brussels, no one doubts that the Europeans are going to be the following: general surcharges of between 10% and 20%, which could reach 100% in the case of cars. In an interview with Bloomberg in campaignTrump complained about a trade deficit that he places at $300 billion (a false figure, the real one is around $125 billion in 2023). “The EU treats us so badly”he states.

Community leaders have also drawn lessons from the experience of his first term: the American magnate imposed customs duties on Spanish black olives or European steel and aluminum and launched a trade war against Brussels on account of cross subsidies from Airbus and Boeing.

The Von der Leyen Commission has been preparing a secret plan to confront Trump’s threat. A program of which until recently only its general lines were known: first offer him a series of small commercial agreements to try to appease him; but deploy in parallel a counterattack arsenal if appeasement fails and the ‘reborn’ US president goes ahead with his tariffs.

But in recent days, EU leaders are beginning to finalize their offer to Trump. The president of the European Central Bank (ECB), Christine Lagardedefends betting on what she herself has baptized as “checkbook strategy”. “We could offer to buy certain things from the United States and signal that we are willing to come to the table and see how we can work together. I think this is a better scenario than a pure retaliation strategy, which can lead to a tit-for-tat dynamic. where no one really wins,” Lagarde said this Thursday in an interview with the FT.

“Europe could talk about buy more liquefied natural gas from the United States. And obviously there is the whole category of defense productssome of which we are not able to manufacture here in Europe and which Member States could buy with a common EU approach,” he stressed.

Von der Leyen herself already expressly mentioned liquefied natural gas from the United States at the recent Budapest summit, which could also help Europeans finally wean themselves off of Moscow’s energy imports. “We still get a lot of LNG from Russia. “Why not replace it with American LNG, which is cheaper for us and would reduce our energy prices?” said the president. In her press conference after the approval of her school, the German, who has already had a first telephone conversation with Trump, he reiterated that he will work hard “to maintain constructive cooperation with the North American administration.”

In her interview, Lagarde insists that a proliferation of tariffs would have very negative economic consequences. “In a trade war, an escalation soon occurs with a negative net balance for everyone. This cannot benefit anyone, neither the United States nor Europe, nor anyone. This would induce a global reduction in GDP“warns the president of the ECB.

Deep down, the EU wants to appeal to Trump’s trader instinct, who likes most to negotiate hard and close deals. “My deal-making style is pretty simple and direct. I aim very high and then I keep pushing, pushing, and pushing to get what I’m looking for. Sometimes I settle for less than what I’m looking for, but for the most part I end up with what I want,” he says in his authorized biography, which is precisely called The Art of Negotiation.

Community leaders already tried this route during the first term, with uneven results. In July 2018the then president of the Commission, Jean-Claude Junckersigned an agreement with Trump by which the EU already committed to importing more liquefied natural gas from the US to diversify its energy basket. On agricultural matters, Juncker announced that Europeans would buy more American soybeans.

At the beginning of his first term, Von der Leyen signed with Trump on “locust deal”by which the EU eliminated tariffs on imports of live and frozen specimens of this crustacean from the US. The real impact of this agreement was negligible: purchases of North American lobsters in Europe barely amounted to 100 million euros. But it did serve to lower the temperature of the trade war.

In any case, Trump never removed tariffs on black olives Spanish or European steel and aluminum. Surcharges that have also been maintained throughout Joe Biden’s mandate, which only ended the Boeing-Airbus war. The question now is whether Lagarde’s “checkbook strategy” will work this time, or will equally end in failure.