The European Union is signaling it will not back down in the face of escalating trade tensions with the U.S., as the bloc warned of a potential acceleration of retaliatory measures should former President Trump follow through on imposing harsh tariffs.
The EU’s stern warning comes as Trump’s recent pronouncements on tariffs cast a shadow over ongoing trade negotiations. Specifically, Trump’s threat to hike tariffs on imported steel and aluminum to 50% – up from the existing 25% – has set off alarm bells across the Atlantic. The EU has indicated it will respond if these new duties are implemented.
Meeting in Paris for a ministerial meeting of the Organisation for Economic Co-operation and Development (OECD) on June 3rd and 4th, EU and U.S. trade representatives are poised to meet. The EU views this as a crucial period. A potential breakthrough is needed because with no agreement, the EU stated that existing and potentially new countermeasures could take effect before July 14th.
The EU’s strategy, outlined by a Commission spokesperson, underscores the bloc’s commitment to protecting its economic interests. With a focus on safeguarding industries, protecting workers, and maintaining a level playing field, the EU is stressing the importance of de-escalation through negotiation. The EU had previously greenlit retaliation against $21 billion worth of American goods, targeting politically sensitive states and key agricultural products. Furthermore, the EU has prepared a contingency list targeting an additional $95 billion of U.S. exports, including industrial products like airplanes and bourbon.
Even while issuing strong warnings, The EU stressed its primary objective is to create space for negotiations. Removing tariffs remains a major goal. The EU is focusing on sectors like semiconductors and pharmaceuticals, addressing both tariff and non-tariff barriers and implementing its plan to simplify regulations. Given the stakes, the coming weeks will be critical in determining the future of transatlantic trade relations.
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