Could an EU-US deal be struck to avoid a full-blown trade war?

Good morning. A scoop to start out: Brussels is weighing new powers to temporarily cap EU gas prices, which lately hit file ranges in contrast with the US, to protect European trade from excessive power prices.

Final evening, Russia launched an American instructor from jail in a transfer Donald Trump’s White Home described as a show of “good faith” that will assist talks to finish the battle in Ukraine.

Right this moment, our tech and commerce correspondents report on yesterday’s assembly between Ursula von der Leyen and JD Vance in Paris. And our monetary correspondent previews at this time’s first step in Brussels’ long-threatened battle on pink tape.

Face/Off

European Fee president Ursula von der Leyen has signalled that Washington is open for offers to keep away from all-out commerce battle after assembly US vice-president JD Vance yesterday, write Barbara Moens and Andy Bounds.

Context: Up to now, Europe’s technique with Donald Trump has favoured engagement over confrontation. However on Monday, the US president confirmed he desires to impose 25 per cent tariffs on all metal and aluminium imports on March 12. The European Fee mentioned it would retaliate against US tariffs with “agency and proportionate countermeasures”.

The assembly in Paris, along with chief EU diplomat Kaja Kallas, was the primary face-to-face dialog between von der Leyen and a senior member of the brand new US administration. An individual briefed on the talks mentioned they had been very constructive and centered on areas the place pursuits aligned.

After the assembly, von der Leyen thanked Vance for a “good dialogue on our shared challenges as allies”.

In a separate assertion revealed after the assembly, she “reaffirmed the EU’s dedication to a good commerce relationship [with the US], whereas each events expressed their intention to prioritise financial areas of mutual curiosity, together with power”.

Von der Leyen has beforehand mentioned the bloc is prepared to purchase extra US liquefied pure gasoline, suggesting the place a possible deal might land.

EU commerce ministers will meet for a video name this afternoon to debate the scenario, however will not be anticipated to enter any particulars of a possible retaliation. The principle goal is to “show unity,” one EU diplomat mentioned.

One other matter mentioned by von der Leyen and Vance was synthetic intelligence. The US president didn’t pull his punches on AI, utilizing a speech earlier within the day to lash out towards EU tech regulation, as an example calling Brussels’ content material moderation guidelines for on-line platforms “authoritarian censorship”.

He additionally mentioned that the US “is the chief in AI, and . . . plans to maintain it that approach.” This comes simply because the EU introduced it will mobilise €200bn “to make Europe an AI continent”.

Additionally they talked concerning the transatlantic strategy in the direction of Ukraine and China. Each Vance and von der Leyen will later this week additionally attend the Munich Safety Convention, the place the way forward for Ukraine would be the foremost matter.

Chart du jour: Strained relationship

Most Europeans view the US as a “needed companion”, quite than an “ally”, in accordance with a brand new survey by the European Council on International Relations published today.

Street journey

The rubber on Ursula von der Leyen’s simplification drive hits the street at this time, because the European Fee presents plans on which areas it desires to trim, writes Paola Tamma.

Context: Fee president von der Leyen has vowed to slash red tape to make life simpler for companies. The fee is because of suggest a so-called “omnibus” legislation later this month streamlining four different pieces of legislation — the primary of a number of such legal guidelines. Subsequent up: bettering entry to funding, paperless paperwork, easier chemical legal guidelines.

“The buildup of guidelines over time at completely different ranges, their elevated complexity and implementation challenges are having a major impression on Europe’s competitiveness,” the fee writes in a draft of a communication to be offered at this time.

It pledges to “overview and adapt our regulatory framework to make it extra attentive to the wants of individuals and companies,” in accordance with the draft seen by the Monetary Occasions.

“Firms are fed up. Now we have to point out them that one thing works,” mentioned one senior EU official briefed on the hassle.

Lobbying on the first omnibus law is rife, with letters from international locations together with Germany, France and trade lobbies circulating in Brussels. One by Italy, seen by the FT, asks for diminished reporting necessities for corporations and to push again the implementation of sustainability guidelines “till all excellent points have been correctly addressed”.

Brussels is eager to emphasize this isn’t a push for deregulation, however to “make the Inexperienced Deal workable,” the official mentioned. However environmental campaigners are frightened.

“In case you delay one thing, that’s deregulation. In case you take away some significant a part of the laws, that’s deregulation,” mentioned Sebastien Godinot from WWF Europe’s workplace.

What to look at at this time

1. Canadian Prime Minister Justin Trudeau meets European Fee president Ursula von der Leyen, EU Council president António Costa and Nato secretary-general Mark Rutte in Brussels.

2. EU commerce ministers meet on-line to debate US tariffs.

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