European Commission President Jean-Claude Juncker will have the “full backing” of the European Union as he works out a reasonable trade deal with President Donald Trump, former British Prime Minister Tony Blair told CNBC on Wednesday.
In joint news conference with Juncker on Wednesday afternoon, Trump announced an agreement “to work together toward zero tariffs, zero nontariff barriers and zero subsides on nonauto industrial goods.”
The remarks came shortly after a report by Dow Jones that Trump secured concessions from Europe, averting a larger trade war. However, a European Commission spokesperson said no concessions were made but that talks were ongoing and that Juncker is working to avert new tariffs.
“The important thing to understand about Europe is it’s a huge market, does immense amount of trade with America. It’s very important it protects that market but he will have the full backing of the European Union in taking a reasonable but still tough stand. And he’ll want to make sure he’s representing European interests properly,” Blair said in an interview with “Closing Bell.” Blair spoke shortly before the report of possible concessions by the EU.
Earlier in the day, Trump said he "hoped to work something out on a fair trade deal with Europe."
Tensions have been escalating between the U.S. and the European Union. After the Trump administration slapped tariffs on steel and aluminium imports from Europe, the EU responded by imposing $3.3 billion worth of tariffs on U.S. goods.
Trump has also threatened to hit autos imported from the EU with tariffs. On Wednesday, The Washington Post reported that Trump plans to implement a 25 percent levy on about $200 billion in foreign-made cars this year. However, Sens. Doug Jones, D-Ala., and Lamar Alexander, R-Tenn., are pushing back. On Wednesday, they introduced a bill intended to delay those auto tariffs.
Trump's comments on Wednesday were in sharp contrast to earlier statements.
"The European Union — outside of China and a couple of others — treats us, on trade, as badly as you can be treated," Trump said during a May visit from NATO Secretary-General Jens Stoltenberg.
Blair told CNBC he hoped the tough tariff talk was a way to work out trade agreements and not a signal of a “more profound shift in policy toward economic nationalism.”
“There are real trade issues between the U.S and the EU, between the U.S. and China,” Blair said. “These are things that are perfectly reasonable to want to work out. It’s just that they’ve got to be done in a way that doesn’t end up causing a problem in the whole global trading system.”
— CNBC's Christina Wilke contributed to this report.