Europe’s leading policy makers are busily preparing retaliatory tactics following US president Donald Trump’s threat EU tariffs will “definitely happen”.
This follows the president’s recently signed executive order placing hefty tariffs of 25% each on Canada and Mexico, and 10% above current tariffs on China.
Tariffs would “definitely happen” in the European Union, because “they’ve really taken advantage of us”, Trump told the BBC at the weekend.
EU doesn’t take US farm products, Trump claims
“They don’t take our cars or farm products”, he went on to say, adding the reverse wasn’t true.
The European Commission described Trump’s decision to tax Mexico and Canada as regrettable. Trump’s trade tax was due to start as he entered office, but it quickly became clear they wouldn’t begin until this month.
Placing tariffs on the European Union would also be problematic. “Our trade and investment relationship with the US is the biggest in the world. There is a lot at stake,” a European Commission spokesperson said.
However, the bloc would not lay back and take the tariffs and would “respond firmly to any trading partner that unfairly or arbitrarily imposes tariffs on EU goods”, the spokesperson added.
The EU had recently firmed up its trade deal with Mexcio and revealed trade agreement negotiations were taking place with Malaysia.
Which countries will Trump’s trade tariffs hit?
When asked about the UK, he said it was also “out of line” with how he wanted the two nations to trade, but believed “we can work that one out” and said the UK prime minister Sir Kier Starmer had been “very nice”.
Some experts and analysts believe Britain would fare better than most nations in any trade wars started by Trump.
“The UK has a balanced trade with the US, but the EU has a very big export surplus,” said senior trade adviser to Pagefield and former trade official for the UK government, John Alty.
“To an extent, the UK is maybe not top of Trump’s list, but Trump did say tariffs across the board, so one must take that reasonably seriously.”