If U.S. President Donald Trump wants to heave more trade threats at the European Union, a fresh batch of numbers just gave him a reason.
Figures published on Friday show that the EU’s trade surplus with the U.S. stood at almost 75 billion euros ($83 billion) in the first half of 2019, up more than 11% from a year earlier. While exports to America have consistently outpaced imports, the difference between them has steadily increased: A decade ago Europe’s bilateral surplus with the U.S. was a mere 18.7 billion euros. Another highlight may catch the eye of a leader who sees trade deficits as a sign of weakness:
- Germany’s surplus is by far the largest in the bloc. Total exports outweighed imports by 112 billion euros from January through June. While the surplus for shipments within the EU narrowed by about a third compared to the previous year, it remained steady at 88 billion euros for business with countries outside the bloc.
Europe, and Germany in particular, has already attracted the ire of the U.S. president. The continent withstood Trump’s aluminum and steel tariffs. He’s said he could label German cars a risk to national security and impose tariffs on auto imports. And he’s threatened France over that country’s new digital tax.
Speaking in New Hampshire last night, Trump repeated his frustration. “The European Union is worse than China, just smaller. It treats us horribly.”
Yet so far, the biggest headwind to European trade — and that’s key to its economy because exports make up some 46% of the bloc’s total output — has come from a conflict on the other side of the world.
A recent study by Germany’s Kiel Institute found that the EU, Canada and Mexico might face a more severe hit from the tariffs the U.S. and China have imposed on each other than the two countries themselves. That’s because products subject to import levies are often processed as intermediate goods and then shipped elsewhere, resulting in more expensive end products.
As much as Europe would like to stay out of the tussle that’s preoccupied the world’s two largest economies for more than a year, it’s too late for that. It’s already caught in the middle.