European Union leaders have made it clear that they want to negotiate trade with the US to avoid full-scale conflict. However, with no visible deals, authorities announced plans on Wednesday intended to fight back violently as tariffs on steel and aluminum will be enacted.
President Trump imposes a 25% tariff on all global steel and aluminum imports, including products containing metals such as cooking utensils and window frames. Given the breadth, the European Union said US collection could affect roughly 26 billion euros ($28 billion) of bloc exports.
So the Bullock has announced plans aimed at equal retaliation.
The response is in two parts. Bullock increased tariffs on various goods to retaliate against US measures during Trump's first term, but was suspended under the Biden administration. That suspension will be allowed to expire on April 1, increasing tariffs on billions of euros worth of products such as boats, bourbons and motorcycles.
He said the second step in the block would be to place tariffs on additional products worth around 18 billion euros. Representatives from European countries will consult for two weeks before authorities confirm the list of affected products.
The items proposed for inclusion are industrial and agriculture. It aims to target products that include soy, beef and chicken, which are key exports from Republican bases. These include the Louisiana district, where House Speaker Mike Johnson was elected.
The goal is to enable the new measures by mid-April.
The announcement was Europe's opening move in the unfolding trade dispute.
For the Bullock, American steel and aluminum tariffs are just the beginning of what Trump threatened. He repeatedly vowed to set a wide range of tariffs on American trading partners on April 2nd. He suggests that the tax on cars could be 25%, especially.
“We're in this escalating spiral now,” said Karsten Bruzesky, the global director of macro research at the bank.
On the other hand, the European Union does not want to expand the trade war. European officials have called tariffs “economically counterproductive” and warn that the tariff fight on The-for-Tat will harm everyone involved.
“Taxes are taxes,” Ursula von der Leyen, president of the European Commission, the Bloc's executive arm, said in a broadcast statement on Wednesday. “The work is at risk, the prices are rising. No one needs it.”
However, the Trump administration is reluctant to negotiate, urging European policymakers to adopt a more aggressive stance.
“I traveled to the US last month. In this week's news briefing, Maros Sevkovic, the European Commission's chief trade officer, said: “In the end, as it is said, one hand can't applaud. The US administration doesn't seem attractive to make a deal.”
EU leaders on Wednesday emphasized that the Bloc's response was intended to be proportional, and Sevkovic stressed that it could be avoided “if the US administration accepts our extension.”
Trump's tariffs come at a tough moment for the European economy. After adjoining years of growth, businesses across the block are staring at the prospect of worsening trade terms that could hurt international businesses.
For example, a group representing Germany's steel industry says tariffs come at “inappropriate times” when European Union producers deal with cheap competition with China.
At least Europe is not caught up in surprise. Colloquisition of trade within the European Union, colloquially known as the “Trump Task Force,” spent much of the last year preparing various trade disputes scenarios.
However, it was difficult to decide how Europeans and other American trade partners would respond. It is also unclear what Trump's goals are, or which goals will ultimately be retained.
“It's hard to know what sticks and what sticks,” said Michael Strain, director of economic policy studies at the American Institute of Business Research in Washington, who recently held an event with Sevkovich.
European officials also struggle to get their American counterparts over the phone. Von der Leyen has not spoken individually with Trump since taking office.
At a Sunday press conference where she might tell him, she said: “We'll have a personal meeting when we have time.”
Kaha Karas, the chief diplomat for the Bullock, was due to meet with Washington's US Secretary of State Marco Rubio in late February, who canceled the meeting.
And diplomats from the European Union and its member states have struggled to determine who to talk to in the Trump administration. Part of this is due to a lack of clarity about how decisions are being made.
“These research institutes include: “We are committed to providing a wide range of research institutes,” said Jornfleck, senior director of the European Centre at the Atlantic Council, a Washington-based research institute.
He said Europe might struggle to deal with more in a world where the US simply doesn't want to trade.
“Probably no deal,” he said.
