Brussels seeks companies' US spending plans as Trump hails move toward talks
Trump said on Tuesday the European Union's move to set up talks was positive and that he hoped Europe would "open up" to trade with the US, even as he repeated a threat to impose trade terms if no agreement emerges
Highlights:
- European corporate spending could help re-industrialise US
- Trump calls urgency around talks a 'positive event'
- Some German companies losing interest in US investment, survey finds
- ASEAN leaders vow to avoid beggar-thy-neighbor deals with the US
European Union officials have asked the EU's leading companies and CEOs for details of their US investment plans, according to two sources familiar with the matter, as Brussels prepares to advance trade talks with Washington after US President Donald Trump backtracked on threatened steep tariffs on imports from the bloc.
Trump said on Tuesday the European Union's move to set up talks was positive and that he hoped Europe would "open up" to trade with the US, even as he repeated a threat to impose trade terms if no agreement emerges.
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"I have just been informed that the EU has called to quickly establish meeting dates. This is a positive event, and I hope that they will, FINALLY, like my same demand to China, open up the European Nations for Trade with the United States of America," Trump wrote on his social media platform.
Over the weekend, Trump walked back a threat to impose 50% tariffs on goods from the region beginning June 1 after "a very nice call" with EU Commission chief Ursula von der Leyen.
The reversal helped power global stocks higher on Tuesday, with US indexes recouping their losses from late last week. The S&P 500 Index was up 2% in mid-afternoon trading, its biggest gain in two weeks.
Ahead of the talks, members of the Confederation of European Business, also known as BusinessEurope, an alliance of 42 federations across the region, received a survey from the European Commission on Monday. It requested information on upcoming US investments with an instruction to respond as soon as possible, one source said.
A similar note seeking information on investment plans for the next five years was sent to the 59-person European Round Table for Industry, a second source said, with a note that the request came personally from von der Leyen.
The roundtable's members include the CEOs of companies ranging from chip equipment maker ASML to chemical group BASF software company SAP and automakers BMW and Mercedes-Benz.
BusinessEurope's members include employer and industry associations representing an equally wide range of companies, notably Germany's auto sector, as well as the aerospace and pharmaceutical industries.
BusinessEurope confirmed it had been contacted to assist with collecting the most recent data on European investment in the US to demonstrate the importance of EU-US economic ties.
The European Round Table for Industry did not immediately respond to a request for comment, while the Commission declined to comment.
The sources asked not to be named because they were not authorised to speak publicly on the issue.
UNCERTAINTY SAPS INVESTOR APPETITE
The Commission, which oversees trade policy for the 27-nation European Union, is stepping up efforts to secure a deal with the United States to end US import tariffs on EU goods, or at least prevent any increases.
The Commission is trying to establish what might satisfy Trump, having offered a deal in which both sides move to zero tariffs on industrial goods, and the EU buys more soybeans, arms and liquefied natural gas.
Trump has made clear a chief goal of his tariffs is to re-industrialise the United States, towards which European corporate investment could contribute.
Some of the biggest investment announcements from Europe so far have come from the pharmaceutical sector, with Swiss pharma companies Roche and Novartis pledging $50 billion and $23 billion respectively. France's Sanofi has said it wants to invest at least $20 billion through 2030.
However, further plans are under threat by Trump's executive order on drug pricing, Roche flagged earlier in May.
At least seven other European companies have said they would increase investments in the US, but gave no specific details on spending plans, a Reuters review of releases and executive comments on earnings conference calls over the last two months shows.
A survey by Germany's Chamber of Commerce and Industry this month found that 24% of companies planned higher investments in the US in the coming year, but 29% were reducing their investments.
An industry association source speaking on condition of anonymity said the uncertainty caused by Trump's volatile policy announcements had reduced interest in US investment.
Italian tyre maker Pirelli said it had to suspend plans to invest further in the US as it needed to ease tensions with Chinese state-owned group Sinochem one of its major shareholders.
ASEAN: NO BEGGAR-THY-NEIGHBOR
Southeast Asian leaders, meanwhile, on Tuesday agreed that any bilateral deals they might strike with the US would not harm the economies of fellow members.
Malaysia's Prime Minister Anwar Ibrahim, the current chair of the Association of Southeast Asian Nations, said there was consensus during an ASEAN summit in Kuala Lumpur that any deals negotiated with Washington would ensure the interests of the region as a whole were protected.
Southeast Asia is among the regions hardest hit by the tariffs, with six of its countries facing levies of between 32% and 49% in July if negotiations on reductions fail.
"While proceeding with bilateral negotiations ... the consensus rose to have some sort of understanding with ASEAN that decisions should not be at the expense of any other country," said Anwar, who on Monday said he had written to Trump requesting an ASEAN-US meeting on the tariffs.
"So we will have to protect the turf of 650 or 660 million people," he said of ASEAN.
