The European Union is about to strike back at the United States with its initial round of retaliatory tariffs, after US President Donald Trump recently declared a blanket 20% tariff on EU products. The retaliation, to be implemented on April 15, is a decisive move in a rapidly escalating trade war between two of the world's largest economies, the New York Times reported.
First reaction targets US exports
European foreign and trade ministers gathered in Luxembourg on Monday to adopt and distribute the updated list of tariffs, which will be voted on Wednesday. The initial round of tariffs is intended to retaliate against previous US tariffs on steel and aluminium and originally targeted symbolically American items like bourbon and motorcycles. Yet EU officials said that whiskey was taken off the final list to prevent triggering a more severe US response, including a planned 200% tariff on European liquor.
A gradual approach to prevent escalation
The EU response is a graduated one aimed at combining toughness with flexibility. By progressively applying tariffs, European leaders hope to avoid an initial escalation and to reserve room for resuming the negotiations in Washington. "The EU remains committed to serious negotiations but is also ready to protect our interests," said the bloc's trade commissioner, Maros Sefcovic.
The EU is particularly careful not to hurt its own firms and consumers. Officials have been refining the tariff list to concentrate on American goods that send a political message but do not heavily raise prices for Europeans.
Diverging voices within the bloc
While northern European nations have called for a robust reaction, others such as Italy have called for prudence. Italian Prime Minister Giorgia Meloni condemned what she described as a "childish" idea that EU countries had to make a choice between the US and the bloc, calling for balanced diplomacy.
Targeting US tech companies is still on the table
If tensions rise any further, EU officials are also weighing retaliatory action against American service exports, with special emphasis on tech heavyweights like Google. French officials have already signalled that online services may be the next to come under scrutiny if the US keeps up the aggressive behaviour.
Carrots failed, sticks are next
In the preceding months to the tariff declaration, the EU had attempted to steer clear of confrontation by providing concessions like additional purchases of American liquefied natural gas. These attempts proved futile, and a move to more aggressive steps was made.
Even as plans for retaliation are being formed, EU leaders have not abandoned diplomacy. Elon Musk, a close Trump advisor, recently urged a "zero-tariff situation" between the two economies, and indicated that a wider free-trade zone could be on the cards if both sides agree to negotiate.
Talks may take time
Even with these diplomatic advances, however, the process is expected to be sluggish. Treasury Secretary Scott Bessent said on Sunday that such matters "are not the kind of thing you can negotiate away in days or weeks." Meanwhile, Europe's first counteraction is only days away from enactment, with more escalation looming in the wings if the US continues on its present trajectory.
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