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Europe Retaliates Against Trump’s Tariffs as Trade Fight Widens

Europe Retaliates Against Trump’s Tariffs as Trade Fight Widens


The European Union has spent months bracing for painful tariffs from the United States, the bloc’s most important trading partner. On Wednesday, as American steel and aluminum tariffs of 25 percent took effect, European officials began to respond.

While the United States buys the most steel and aluminum from countries including Canada, Brazil and Mexico, Germany is a notable steel producer.

And because the tariffs will also affect products that contain steel and aluminum, such as cookware and window frames, the European Union said, they may hit some 26 billion euros — $28 billion — of the bloc’s exports in total.

Wednesday’s rebuttal is the European Union’s attempt to hit back in equal measure.

The response will come in two parts. The European Union had increased tariffs on a range of goods in retaliation to U.S. measures during President Trump’s first term, but they were suspended under the Biden administration.

That suspension will be allowed to lapse on April 1, meaning that higher tariffs would take effect on billions worth of products that include boats, bourbon and motorcycles.

The bloc’s second step, it said, would be to place tariffs on €18 billion worth of additional products. Representatives from countries across Europe will consult for two weeks before officials finalize the list of products that would be affected.

Items that have been proposed for inclusion are industrial and agricultural, including home appliances, poultry and beef. The goal is to have those new measures in force by mid-April.

The announcement was Europe’s opening move in an unfolding trade conflict — one that is widely expected to intensify over the course of the month ahead.

For the bloc, the American steel and aluminum tariffs are just the start of what Mr. Trump has promised is coming. He has repeatedly said that he would set wide-ranging tariffs on American trading partners globally as soon as April 2. He has suggested that levies on cars in particular could be 25 percent, a figure that would be painful for German and Italian automakers.

“We’re now in this escalating spiral,” said Carsten Brzeski, global head of macro research at the bank ING.

On the one hand, the European Union does not want to escalate the trade war. Officials want the United States to keep negotiating with them. European officials have called tariffs “economically counterproductive,” warning that a tit-for-tat tariff fight would harm everyone involved.

“Tariffs are taxes,” Ursula von der Leyen, president of the European Commission, the bloc’s executive arm, said in a statement on Wednesday. “Jobs are at stake, prices up, nobody needs that.”

But the Trump administration has been reluctant to negotiate, which is pushing European policymakers to adopt a more aggressive stance.

“I traveled to the U.S. last month; I was seeking constructive dialogue to avoid the unnecessary pain of measures and countermeasures,” said Maros Sefcovic, the top trade official for the European Commission, during a press briefing on Monday. “In the end, as it is said, one hand cannot clap. The U.S. administration does not seem to be engaging to make a deal.”

He added: “As the U.S. is watching over its interests, so is the European Union.”

Mr. Trump’s tariffs come at a tough moment for the European economy. After several years of flagging growth, businesses across the bloc are now staring down the prospect of worsening trade conditions that could hurt their overseas business.

Groups representing the German steel industry, for instance, have said that the tariffs come at an “inopportune time,” when producers in the European Union are already dealing with a flood of cheap competition coming from China.

Europe has not been caught by surprise, at least. A trade-focused group within the European Union, colloquially called the “Trump task force,” spent much of last year preparing for different trade conflict scenarios.

But it has been hard for Europeans — and other American trading partners — to decide how to respond to the threat of tariffs. It is not clear what Mr. Trump’s goals are or which ones will ultimately be retained, because the Trump administration has made a habit of threatening and then backtracking, at least temporarily.

“It’s hard to know what is going to stick and what’s not going to stick,” said Michael Strain, director of economic policy studies at the American Enterprise Institute in Washington, which recently hosted an event with Mr. Sefcovic.

European officials have also struggled to get their American counterparts on the phone. Ms. von der Leyen has not spoken individually with Mr. Trump since his inauguration.

Asked at a news conference on Sunday when she might speak to him, she said: “we will have a personal meeting when the time is right.”

Kaja Kallas, the bloc’s chief diplomat, was supposed to meet with Marco Rubio, the American secretary of state, in Washington in late February, but Mr. Rubio canceled that meeting.

And diplomats from across the European Union and its member countries have struggled to identify who they should talk to in the Trump administration, in part because they lack clarity into how decisions are being made.

“I do think there’s a level of consternation at the objectives of the administration,” said Jörn Fleck, senior director with the Europe Center at The Atlantic Council, Washington-based research institution.

And he said that Europe may struggle more to respond in a world in which the United States does not want to simply make a deal — but rather wants to fundamentally reorder the global trade order so that more is produced in the United States.

“Maybe there isn’t any deal to be had,” he said.



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