European leaders are moving faster than expected. If enacted, this new tariff would increase the price of many goods exported from the EU to the U.S by an average of 30%, sparking a trade war that they would like to avoid. The developing situation has already led to spirited back-and-forth exchanges between EU officials. Finally, they are focusing on putting together a common front and good faith negotiations with the US.
Now, to be clear, Trump’s claim that the EU is slapping us with unfair 39% duties on American imports is totally fake news. EU officials have thoroughly debunked this faulty claim. They point out that the average duty on U.S. imports is not 12% – it’s actually more like 2.5%. The protectionist rhetoric coming from Washington has sent up alarm bells for European leaders. They’re particularly scared about the economic consequences.
In a , European Commission President Ursula Von der Leyen urged the EU to go further to “determine our own fate” in defending the EU’s economic interests. In doing so, he underscored the importance of credible countermeasures. He called on the EU to use all of its tools at its disposal, including anti-coercion measures, should a non-satisfactory deal fail to materialize by August 1.
Dutch Prime Minister Dick Schoof echoed Macron’s sentiments to the fullest. He stressed that the EU needs to remain united and determined in its position and approach to negotiations. He made clear his desire for a win-win agreement that would prevent the deepening economic rift between the two areas.
The recent tariffs have drawn sharp criticism from all corners in Europe. Giorgia Meloni, Italy’s prime minister, is confident that a “fair deal” can be reached with the U.S. What she’s calling attention to is the real, and often immediate, danger of heightened tensions. She stated, “it would make no sense to trigger a trade war between the two sides of the Atlantic.”
Germany’s automotive industry is particularly vulnerable to Trump’s tariff threats. The Federation of German Industries (BDI) characterized Trump’s announcement as “a wake-up call for the industry on both sides of the Atlantic.” The sector is in a bit of a pickle. Tariffs on exports to the U.S. have already spiked to 25%, and current antidumping duties only add to the burdensome stranglehold.
Katherina Reiche, a representative of the automotive sector in Germany, urged pragmatic UK-US negotiations. She urged that “a pragmatic outcome to these negotiations must be reached quickly,” emphasizing the urgency of addressing the looming tariff threats.
In contrast to Macron’s call for readiness for a trade war, some leaders are advocating for a more tempered response. Emanuele Orsini, an Italian MP from the ruling party, called for composure and told Europe’s leaders to “keep our cool” in the face of this crisis. Ireland’s deputy prime minister, Simon Harris, agrees with him on that at least. He insisted there is “absolutely no need to raise tensions” with the United States over steel and aluminum tariffs.
The Swedish finance minister understood the inevitable economic misery that would result from such negotiations. Instead, he pointed out that previous deals were considered bad. He characterized them as “egregious,” highlighting the issues involved in coming to a conclusion.
As discussions continue, European leaders are well aware of the high stakes. As Raffaele Boscaini, Vice President for Public Affairs at Cargill pointed out, the EU and Italian government should focus on tangible actions to strengthen competitiveness. This means investing in digital infrastructure, providing access to credit, and cutting red tape.