As Trump implements additional tariffs to pressure trade partners, countermeasures are emerging. To demonstrate seriousness, he enacted these tariffs without entering into substantial negotiations. Starting in April, he plans to introduce additional tariffs targeting the European Union and others, but the EU is not idle.
EU and Customs Duties
In response to the U.S. tariffs on steel and aluminum, the EU officials had previously indicated a commitment to swift and forceful retaliation, yet their response has been notably delayed. The U.S. is aware of its significant role in global trade. However, Trump’s uncompromising stance and near-impossible demands are pushing other nations into a corner. Will Canada become the 51st state or enter a trade war? The latter option seems more plausible.
Starting in April, the European Union plans to impose a 50% customs duty on Kentucky whiskey and Harley-Davidson motorcycles to deliver a meaningful response targeting well-known products.
This is Trade Justice
To curb the budget deficit, Trump aims to increase exports through additional tariffs. He is pressuring companies to “come and produce in the U.S.”, claiming both America and they will benefit. Yet, the world is larger than just the U.S. EU officials have noted that their countermeasures could hinder approximately $24.5 billion worth of U.S. exports.
This figure could rise to $28 billion, which corresponds to the total cost of U.S. tariffs affecting EU exports. Thus, while the U.S. restricts $28 billion worth of imports with additional tariffs, it simultaneously risks losing out on $28 billion in exports.
EU Trade Commissioner Maros stated that despite weeks of negotiation efforts, the U.S. seems unwilling to reach an agreement. The American Chamber of Commerce in the EU warned that both sides would suffer in terms of employment, prosperity, and security.
In response to the initial U.S. tariffs on steel and aluminum in 2018, the Trump administration had already taken countermeasures. Although the introduction of additional tariffs was reversed after Biden took office, products on this specially prepared list have again encountered these tariffs.
