Paris (Brussels Morning Newspaper) – In response to the US, France suggested the European Union consider for the first time using the most powerful trade influence tool. It is possible that this response will be triggered if US President Donald Trump imposes new tariffs on European countries, Bloomberg reported.
The US prepares to put sharp tariffs on global partners as early as April 2. As US President Trump previously said, these tariffs are intended to address non-tariff barriers that he thinks are unfair.
According to sources, the tool refers to a so-called “counter-coercion tool,” which is prepared to strike back against governments or states that use trade and economic measures to control political decisions.
How does the EU’s counter-coercion tool work?
In accordance with the so-called “anti-coercion instrument,” the European Union will be able to implement a range of countermeasures, including trade and service restrictions and restrictions on certain intellectual property rights, foreign direct investment, and access to public procurement.
The instrument was primarily developed to deter and, if necessary, react to deliberate coercive actions by third nations that use trade measures to press the sovereign policies of the EU or its individual member nations.
As part of the EU’s efforts to strengthen trade protection, this tool was adopted after US tariffs were imposed on the bloc’s exports during Trump’s first term. A second factor was China’s decision to restrict Lithuanian goods after Taiwan opened a trade office in the Baltic country.
As reported by sources, the European Commission may propose the usage of the instrument, but then the member nations must determine if a compelling case exists and whether it should be applied. As part of the process, the EU will attempt to confer with the coercing party and may also collaborate with like-minded partners facing similar pressures.
How is the EU balancing negotiation and retaliation?
European Trade Commissioner Maroš Šefčovič stated that he had no particulars regarding the new US tariffs and that the EU Commission would be required to continue preparations and maintain a flexible procedure. Additionally, the EU’s response to the metal tariffs was postponed until mid-April, giving more time to negotiate with the US.
It was previously reported that on March 20, the European Union postponed the imposition of its first retaliatory measures against the US over the metal tariffs out by Trump until mid-April. It is expected that this will permit time to decide which US goods should be subject to tariffs.
