Trump signs a 12-country memorandum to escalate pressure, with a maximum 70% tariff bomb potentially detonating on August 1!

According to the Zhitong Finance APP, U.S. President Donald Trump stated that the U.S. is preparing to set a maximum unilateral tariff rate of up to 70%, which will take effect on August 1. This move puts pressure on global trade negotiations while delaying the imposition of tariffs. The European Union will hold crucial talks with the U.S. over the weekend in an effort to reach a temporary trade agreement to avoid higher tariffs. Informed sources said that officials from the European Commission, the EU's executive body, informed member states on Friday that they are close to reaching a potential agreement framework with the U.S., which would maintain the current 10% tariff on most European imports. EU officials held negotiations in Washington last week, racing to reach an agreement before July 9, when Trump previously threatened to raise tariffs on EU imports to 50%. The negotiations are still dynamic, and the details of the agreement may change, with the final outcome uncertain. Trump stated that the U.S. is prepared to notify multiple trading partners that import tariffs will range between "60% to 70% and 10% to 20%." As the U.S. market is closed for Independence Day, global investors are in a defensive mode. Trump indicated that these notifications would be sent out before July 9, which is the deadline set by the White House to end the 90-day suspension period for the "reciprocal" tariffs first introduced in April. He stated, "They will start paying tariffs from August 1." Later on Friday evening, Trump mentioned in subsequent comments that he had signed about 12 letters, which would be sent to the relevant countries on Monday. Inga Fechner, an economist at ING Group, stated that the signal that tariffs will take effect in August indicates that the U.S. wants more time to continue pushing for agreements with major trading partners such as the EU, Japan, and South Korea. "This is the most noteworthy point because it essentially means he will leave more room for negotiations." Fechner pointed out that if higher tariffs take effect next week, major trading partners may retaliate. Currently, the U.S. government has reached preliminary trade agreements with the UK and Vietnam and has a sporadic truce agreement with China. It remains unclear whether the EU can secure tariff reductions for specific industries such as automobiles or steel, which are key demands from member states like Germany. The EU currently faces a 25% tariff in the automotive sector, while steel and aluminum products face a 50% tariff. Informed sources said that EU officials informed ambassadors from member states on Friday that the Trump administration is expected to categorize trading partners into three groups based on the progress of negotiations next week: Countries that have reached a principled agreement with the U.S. will continue to apply the 10% baseline tariff in the near term, with potential further reductions in the future; Trading partners close to reaching an agreement will see their baseline tariffs rise to country-specific levels announced earlier this year before the final agreement is reached; If the Trump administration believes negotiations with a certain country are not progressing well, tariffs will indefinitely revert to a higher level. The Trump administration stated that it is prioritizing negotiations with core trading partners, and the July 9 deadline for these countries may be flexible, but the U.S. does not have the capacity to negotiate in detail with all global partners. Treasury Secretary Scott Bessent recently stated that the U.S. "may complete trade negotiations before Labor Day." and focus on reaching agreements with 18 key trading partners. However, when Trump was asked about other agreements at a media briefing on Thursday, he stated, "We have a few other deals, but you know, my inclination is to send a letter stating how much they will pay in tariffs." A spokesperson for the European Commission said on Friday that the EU hopes to resolve issues with the U.S. through negotiations and has made progress on a principled agreement during the last round of talks held in Washington before Independence Day. The spokesperson noted that after discussing the status of trade negotiations with EU member states, the Commission will re-engage with the U.S. over the weekend to discuss the substantive content of potential agreements. "In the meantime, we are also preparing for the possibility of not reaching a satisfactory agreement, and the EU is ready to impose counter-tariffs against the U.S." If the terms of the agreement are too favorable to the U.S., they may face resistance from EU member states. A European official stated that the U.S. draft is a "take it or leave it proposal," but the details remain unclear, and the content may still evolve as negotiators continue discussions over the weekend. The official revealed that certain product categories may be exempt from tariffs. For example, both sides agreed that European car manufacturers could export one car to Europe tariff-free for every car produced in U.S. factories for export back to Europe—this provision only benefits specific manufacturers like Germany's BMW. The draft also requires the EU to lift legal restrictions on U.S. meat imports, excluding chlorine-washed chicken. This change could spark controversy in European countries with significant agricultural sectors, such as France. Insiders say that as part of the agreement, the U.S. wants the EU to accept a 17% tariff on certain agricultural products, although an EU diplomat indicated that it is unclear whether the U.S. will insist on this. EU Trade Commissioner Maroš Šefčovič met with U.S. officials on Thursday, and both sides stated that more work is still needed