European Union finally walks the tariff talk, takes the war to Trump with first barrage of punishing counter-measures

The European Union finally took the tariff war to Trump on April 9, announcing the first set of counter-measures in response to the US President's aggressive unsettling of world trade. European retaliation will now affect over 20 billion euros worth of American goods such as soybeans, motorcycles, and beauty products, according to a European Commission statement, which also noted, "These countermeasures can be suspended at any time, should the US agree to a fair and balanced negotiated outcome."

This move serves as retaliation for the US's prior tariffs placed on steel and aluminum, while the EU's reaction to Trump's latest round of tariffs is still pending, news agency AFP reported. EU member states were largely anticipated to initiate these countermeasures, aligning themselves with China and Canada in a tit-for-tat escalation that risks developing into a global trade conflict.


The approval of these measures coincides with the implementation of Trump's "reciprocal" tariffs targeting the EU and numerous other nations, which include a staggering 104% tariff on imports from China, further intensifying his trade offensive and contributing to a sell-off in global financial markets.

The 27-member bloc is currently facing 25% tariffs on steel and aluminum, as well as on vehicles, in addition to the new comprehensive tariffs of 20% that apply to most other products under Trump's strategy aimed at countries he accuses of imposing high trade barriers against U.S. exports.

On Monday, the European Commission, responsible for coordinating trade policies within the EU, suggested additional tariffs primarily set at 25% on a variety of U.S. imports, specifically in response to the U.S. metals tariffs. The Commission is still evaluating its strategy concerning the automotive and broader tariffs.

The targeted imports include motorcycles, poultry, fruit, wood, clothing, and dental floss, as indicated in a document reviewed by Reuters. These products accounted for approximately 21 billion euros (around $23 billion) in imports last year, making the EU's retaliation against a value lower than the 26 billion euros of EU metal exports impacted by U.S. tariffs.

The new tariffs will be implemented in phases on April 15, May 16, and December 1. On Wednesday afternoon, a committee consisting of trade experts from the EU's 27 nations will cast their votes on the Commission's proposal, which can only be blocked if a "qualified majority" of 15 EU members, representing 65% of the EU population, vote against it.

Given that the Commission has already consulted with EU members and adjusted the initial proposal from mid-March, removing U.S. dairy and alcoholic beverages from the list, it is unlikely that such a blockage will occur.

Concerns were raised by major wine-producing countries, including France and Italy, after Trump threatened to impose a 200% tariff on EU wines and spirits if the EU proceeded with its intended 50% tax on bourbon.

In response to the counter-tariffs announced by Beijing last week, Trump has already taken action, nearly doubling tariffs on Chinese imports. China has declared its intention to "fight to the end" in this escalating trade dispute.