EU vows countermeasures to US tariffs

Tariffs imposed by the United States on steel and aluminum “will not go unanswered”, European Union chief Ursula von der Leyen vowed on Tuesday, adding that they will trigger tough countermeasures from the 27-nation bloc. It means iconic American industries like bourbon, jeans and motorcycles should beware.

“The EU will act to safeguard its economic interests,” von der Leyen said in a statement, in reaction to US President Donald Trump’s imposition of tariffs on steel and aluminum on Monday.

“Tariffs are taxes – bad for business, worse for consumers,” von der Leyen said. “Unjustified tariffs on the EU will not go unanswered – they will trigger firm and proportionate countermeasures.”

Just as Trump imposed similar tariffs during his first presidency, the EU countermeasures could easily amount to those that were used to retaliate then if the measures come into force on March 12.

Bernd Lange, the chair of the European Parliament’s trade committee, warned that previous trade measures were only suspended and could legally be easily revived.

“When he starts again now, then we will, of course, immediately reinstate our countermeasures,” Lange told rbb24 German radio.

”Motorcycles, jeans, peanut butter, bourbon, whiskey and a whole range of products that, of course, also affect American exporters” would be targeted, he added.

The EU Commission, which negotiates trade relations on behalf of the bloc, said it is not clear what countermeasures would apply, but officials and observers have said they would target Republican states and traditionally strong US exports.

In Germany, which is the EU’s largest economy, Chancellor Olaf Scholz told parliament that “if the US leaves us no other choice, then the European Union will react united”, adding: “Ultimately, trade wars always cost both sides prosperity.”

Trump is hitting foreign steel and aluminium with a 25 per cent tax in the hope that they will give local producers relief from intense global competition, allowing them to charge higher prices.

EU Commission Vice-President Maroš Šefčovič said on Tuesday that the tariffs are “economically counterproductive, especially given the deeply integrated production chains established through our extensive transatlantic trade and investment ties”.

“We will protect our workers, businesses and consumers,” Šefčovič said, but added that “it is not our preferred scenario. We remain committed to constructive dialogue. We stand ready for negotiations and to find mutually beneficial solutions where possible”.

The EU estimates that the trade volume between both sides stands at about US$1.5 trillion, representing some 30 per cent of global trade. “There is a lot at stake for both sides,” he told the EU legislature.

While the bloc has a substantial export surplus in goods, it says that is partly offset by the US surplus in the trade of services.

The EU says that trade in goods reached €851 billion (US$878 billion) in 2023, with a trade surplus of €156 billion (US$161 billion) for the EU. Trade in services was worth €688 billion (US$710 billion), with a trade deficit of €104 billion (US$107 billion) for the EU.

AP