TMTPOST -- The European   Union is   taking   advantage   of the extended time window to settle a   framework   trade deal with U.S.   that allows certain   exemptions or   concessions   for   tariffs   on   key   sectors, according to reports   on Monday.

Credit：China Central Television

The Trump administration   will   not send letters to the EU about higher   tariffs   as the bloc was close   to an agreement with   the U.S.,   Reuters   cited European sources on Monday.   It   was reported the   EU   is eyeing possible   exemptions from   the current 10% baseline   tariffs.   The EU-U.S. agreement   could reportedly involve   limited   concessions   to   the   baseline tariffs   for aircraft and parts, some medical equipment and spirits.

The news, if it   is accurate, suggests   the EU   is spared under   the new   round   of tariffs set to go   in   effect on August 1.   U.S. President Donald Trump said on April 9 that he has authorized a 90-day pause and "a substantially lowered reciprocal tariff"   of 10% during this period, both effective immediately. The   President   on Monday signed an executive order, delaying the tariff deadline on July 9,   Wednesday,   to August 1.

Trump on Monday also posted letters dictating tariffs on 14 countries, ranging from 25% to 40%. The U.S. will impose these new tariffs on all imports from   Japan, South Korea, Kazakhstan, Malaysia,Tunisia, South   Africa, Bosnia and   Herzegovina, Indonesia, Bangladesh, Serbia, Thailand, Cambodia, Laos and Myanmar, starting on August 1, separating from all existing sectoral   tariffs, and goods transshipped to evade a higher tariff will be subject   to that higher tariff.  

Companies in Japan or South Korea   will   be   exempted   from   the new tariffs if they decide   to build or manufacture   goods in the United States,   Trump said   in his letters   posted on   his social media Truth Social   Monday.   "If for any reason you decided   to raise your Tariffs, then, whatever   the number you   choose to raise   them by,   will be added onto the 25% that   we charge,"he warned.

The EU is seeking to conclude a preliminary trade   deal with the U.S.   this week   to lock in a   10% baseline   tariff rate beyond August 1,    Bloomberg   reported on Monday. The bloc   is also   looking for   exemptions   from the 10% tariffs for certain key products, including aircraft   and its parts,   and spirits,   the report quoted   sources.

The EU was said to be   pushing for   quotas and   exemptions on U.S. sectoral   tariffs,   including   25% levies   on   automobile and   car parts   and   the 50%   levies on steel and   aluminium.    The EU and the U.S.   are discussing   a so-called offsetting mechanism that would allow European companies that make automobiles in the U.S.   to export a certain number tariff free,   per the report.

Earlier Monday, the   EU   said it is working towards securing a framework deal   with the U.S.   before   Trump ’ s   previous July 9 deadline.   "We are continuing to work towards the deadline of the 9th of July and in that sense, political and technical level contact between the EU and U.S. continues," said Olof Gill, a spokesperson for the European Commission, which is in charge of leading trade talks for the EU   as a whole.

Gill said that "substantial progress" was made on securing a   EU-U.S. agreement in principle   after the EU ’ s trade chief.   European Trade Commissioner Maros Sefcovic   talked with American counterparts   last week. He also said   European   Commission President Ursula von der Leyen and Trump   had a good exchange   during   their phone call on Sunday. "We ’ re fully geared up to get an agreement in principle by Wednesday and we ’ re firing on all cylinders to that effect," Gill   said.

Portuguese Finance Minister Joaquim Miranda Sarmento the same   day said   the EU and the U.S. could   strick e a deal   with very low tariffs   and   the tariff rates   are "probably less than 10%, but let ’ s see what ’ s the outcome."