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TRADE

Macron ‘not in favour’ of vast new US-EU trade deal

French President Emmanuel Macron said Thursday he viewed talks between US President Donald Trump and EU Commission chief Jean-Claude Juncker as "useful", but he was "not in favour" of a "vast new trade deal" between the European Union and the United States.

Macron 'not in favour' of vast new US-EU trade deal
Photo: AFP
“European and France never wanted a trade war and the talks yesterday were therefore useful in as far as they helped scale back any unnecessary tension, and working to bring about an appeasement is useful,” the French leader said after a meeting with Spanish Prime Minister Pedro Sanchez in Madrid. 
   
“But a good trade discussion… can only be done on a balanced, reciprocal basis, and in no case under any sort of threat,” Macron said. 
   
“In this regard, we have a number of questions and concerns that we will clarify”.
 
Macron said he was “not in favour of us launching a vast trade agreement, along the lines of the TTIP, because the current context does now allow for that,” referring to a transatlantic free-trade deal which stalled two years ago.
   
And he reaffirmed his opposition to including agriculture in any such deal. 
 
“I believe that no European standard should be suppressed or lowered in the areas of the environment, health or food, for example.” 
   
Macron went on to insist that “clear gestures are needed from the US, signs of de-escalation on steel and aluminium, on which the United States have imposed illegal taxes. That, for me, would constitute a prelude to making further concrete headway” on trade.
 
In the US on Wednesday, Trump and Juncker announced a plan to defuse a lingering trade row, that in effect saw Washington back off a threat of auto tariffs against Europe, at least for now.
   
Nevertheless, the details of the deal remained vague, with a statement mentioning that the transatlantic allies would “launch a new phase” in the relationship.
   
Spanish premier Sanchez, for his part, also said “we don't want any trade war” and said he was determined to “defend (the EU's) common agricultural policy”.

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US

Trump orders investigation into France’s planned tax on tech giants

US President Donald Trump has ordered an investigation into France's planned tax on internet services that will hit American tech giants especially hard, officials said Wednesday.

Trump orders investigation into France's planned tax on tech giants
Photo: AFP
The investigation into unfair trade practices could pave the way for Washington to impose punitive tariffs, something Trump has done repeatedly since taking office.
   
“The United States is very concerned that the digital services tax which is expected to pass the French Senate tomorrow unfairly targets American companies,” US Trade Representative Robert Lighthizer said in a statement.
   
The proposed three percent tax on total annual revenues of companies providing services to French consumers only applies to the largest tech companies, “where US firms are global leaders,” the trade representative's office said.
 
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France to introduce tax on big US tech firms in JanuaryPhoto: AFP

The so-called Section 301 investigation is the primary tool the Trump administration has used in the trade war with China to justify tariffs against what the United States says are unfair trade practices.   

USTR will hold hearings to allow for public comment on the issue over several weeks before issuing a final report with a recommendation on what actions to take.
   
Despite the objections to the French tax proposal however, the statement said the United States will continue to work with other advanced economies to address the conundrum of how to tax tech companies.
   
The Group of 20 has tasked the Organization for Economic Cooperation and Development with finding a fix in the international tax system that has allowed some internet heavyweights to take advantage of low-tax jurisdictions in places like Ireland and pay next to nothing in other countries where they make huge profits.
   
The Computer & Communications Industry Association on Wednesday applauded the US Trade Representative's move, saying the tax would retroactively require US internet giants operating in France to turn over a percentage of their revenues from the beginning of this year and violates international trade commitments.
   
“This is a critical step toward preventing protectionist taxes on global trade,” CCIA official Matt Schruers said in a statement.
   
“CCIA encourages France to lead the effort toward more ambitious global tax reform, instead of the discriminatory national tax measures that harm global trade.”
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