Last week, President Trump's announcement imposed a 20% tariff on goods from the European Union, sending shockwaves to blocs of 27 countries.
This week, Europe will push for its first measures.
EU officials have spent the past few weeks refined the list of retaliatory tariffs scheduled to be set up on April 15th.
These tariffs will come in response to the steel and aluminum collections previously announced by Washington, and they are expected to be wiped out. The spare list covered everything from whiskey and motorcycles to boats and soybeans. But they are also the opening bid for Europe's response to Trump's tariff deployment.
European authorities are working on additional plans to address the car rates announced in late March, and are working on the 20% full tariffs that Trump announced last week.
EU leaders are coming back in stages for two reasons. First, they needed time to digest the gusts of the announcement that came from the White House. They wanted to design responses that would most hurt the US, while minimizing fallout for European consumers and businesses.
They also hope to give the Trump administration time to come to the negotiation table by gradualizing their responses. The ultimate goal is to still trade to avoid an all-out trade war.
“The EU has committed to meaningful negotiations, but we have also prepared to defend our interests,” Bullock's trade commissioner Maros Sevkovic wrote on social media on Friday night, following what he described as a “frank” two-hour meeting with his American counterpart.
When trade disputes heat up, interests increase. The European Union is one of America's most important trading partners. And the US is by far the largest export market for European goods.
Given its close relationship, returning to American tariffs could be a painful movement. This also costs European businesses and consumers, pushing up tariff prices.
European officials recognize that escalating trade wars on both sides of the Atlantic can be painful. That's why they edited the list. The staff wanted to take into account feedback from across the continent.
Some of the list, including the original whiskey tariffs, were actually originally intended to settle on March 31, but were delayed for further improvements after Trump threatened to respond by slapping 200% tariffs on all European alcohol coming to the US. Such a move will be crushed for French and Italian winemakers.
The delay came after officials from France suggested that it was a mistake to hit whiskey and cause American retaliation for alcohol.
The episode highlighted the challenge of maintaining a solid united front when dealing with tariffs. Countries across the continent have different economic priorities and different appetites to return to the US.
While some Northern European countries have asserted that the European Union must be strong in its response, Italian Prime Minister Giorgia Meloni has called for the idea that Italy must choose between the US and the Bullock “childish.” She also warns against harsh retaliation.
EU officials initially wanted to avoid trade disputes entirely.
They had been hoping to avoid a showdown last fall and earlier this year with hanging carrots in front of their American counterparts, like buying American liquid natural gas.
But that strategy failed. Instead, Washington is taking on a much more aggressive tack than many analysts and officials expected. This led European policymakers to compete to create plans.
In particular, European leaders are thinking of hitting American services exports, especially in large technology companies that do large EU businesses like Google.
Several European diplomats say targeting technology companies revealed that online services could be the first in crosshairs last week if the trade war escalates.
But the real goal is trading.
Elon Musk, a technology entrepreneur and close adviser to Trump, said on Saturday that he hopes Europe and the US will “move into a zero tariff situation and effectively create a free trade zone.”
European officials have shown an appetite to lower tariffs on automobiles and other products, so if the US is willing to speak, it is possible to hold back the duties of at least some sectors.
However, the resolution can take some time. Treasury Secretary Scott Bescent said in a television interview on Sunday that the issue with trading partners is not “something that can be negotiated in days or weeks.”
