Although the United States and China recently reached a temporary “tariff truce” agreement that has eased long-standing trade tensions, the European Union (EU) welcomed the move, viewing it as a step toward stabilizing the global trade environment. However, EU Trade Commissioner Valdis Dombrovskis emphasized that despite this slight improvement in the international situation, the EU remains cautious — even pessimistic — about its economic growth outlook for 2024.
Cautious Optimism: EU Welcomes US-China Tariff Cuts
Dombrovskis stated that the willingness of both the U.S. and China to negotiate and reduce certain tariffs is a move in the right direction. He noted that the agreement has somewhat alleviated the EU’s concerns about China potentially shifting its exports and further impacting European industries.
However, he also warned that U.S. tariffs on Chinese goods remain high, and trade barriers are still in place. As such, the underlying uncertainties of global trade have not fundamentally changed.
Heavy Internal Challenges Limit Recovery Momentum
Despite modest improvements in the global trade environment, the EU continues to face serious internal economic challenges. Dombrovskis pointed out that inflationary pressures persist, energy price volatility remains, and geopolitical risks are intensifying — all of which make a swift EU economic recovery difficult.
The European Commission is maintaining a cautious stance on economic growth forecasts for 2024 and has not ruled out the possibility of performance falling short of expectations.
