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The European Union has announced retaliatory trade measures against the United States, imposing tariffs on a range of industrial and agricultural products in response to the latest round of U.S. duties on steel and aluminum imports.
The new EU tariffs, which will take effect from April 1, are aimed at counterbalancing the Trump administration’s 25% levy on all steel and aluminum imports.
The decision intensifies already fraught transatlantic trade relations, with the EU rolling out countermeasures amounting to €26 billion ($28 billion).
The targeted goods extend beyond steel and aluminum, including textiles, home appliances, and agricultural products such as poultry, beef, seafood, nuts, and sugar. High-profile American exports like motorcycles, bourbon, peanut butter, and jeans—previously affected during Trump’s first term—are also on the list.
While the EU stands firm on its decision, the United Kingdom, having left the bloc, has opted against imposing similar retaliatory measures, instead expressing disappointment at Washington’s tariff decision.
Von der Leyen: EU Will Defend Its Interests
European Commission President Ursula von der Leyen reaffirmed the EU’s commitment to fair trade and open dialogue but warned against measures that could further strain global economic stability.
“As the U.S. applies tariffs worth $28 billion, we are responding with countermeasures worth €26 billion,” she stated.
“We firmly believe that in a world fraught with geopolitical and economic uncertainties, it is not in our common interest to burden our economies with tariffs.”
- The commission, responsible for handling trade disputes on behalf of the EU’s 27 member states, emphasized that such tariffs disrupt supply chains and increase costs for consumers and businesses on both sides of the Atlantic.
“We deeply regret this measure. Tariffs are taxes. They are bad for business and even worse for consumers,” von der Leyen added.
- The EU’s response will unfold in two phases: an initial reinstatement of “rebalancing measures” previously imposed between 2018 and 2020 but suspended under the Biden administration, followed by additional duties targeting $19.6 billion worth of U.S. exports.
- EU Trade Commissioner MarošŠefčovič recently met with U.S. officials, including Commerce Secretary Howard Lutnick, in an attempt to de-escalate tensions. However, he acknowledged that negotiations had failed to yield a breakthrough.
“I argued to avoid the unnecessary burden of measures and countermeasures, but you need a partner for that. You need both hands to clap,” Šefčovič remarked.
Impact on European Steel Industry
The European steel sector stands to bear significant losses, with the industry bracing for a reduction of up to 3.7 million tons in steel exports to the U.S., according to Henrik Adam, president of the Eurofer European steel association.
“It will further worsen the situation of the European steel industry, exacerbating an already dire market environment,” Adam warned.
The United States is the second-largest export market for EU steel producers, accounting for approximately 16% of total EU steel exports. Industry leaders fear that losing a significant portion of these exports will be difficult to offset by expanding into alternative markets.
The Bigger Picture: Transatlantic Trade Relations
Despite the escalating trade tensions, the EU and U.S. remain deeply interconnected economic partners. Annual trade between the two economies is estimated at $1.5 trillion, representing around 30% of global trade. While the EU holds a significant export surplus in goods, the U.S. maintains a surplus in the trade of services.
In 2023, trade in goods between the two sides reached €851 billion ($878 billion), with the EU enjoying a €156 billion ($161 billion) trade surplus. Conversely, the EU recorded a €104 billion ($107 billion) trade deficit in services.
With tensions rising, businesses and consumers on both sides of the Atlantic face uncertainty over the long-term consequences of the escalating trade dispute. Industry leaders are calling for renewed diplomatic efforts to prevent further economic fallout from the intensifying tariff war.
