Washington (Brussels Morning Newspaper) – U.S. President Donald Trump has declined a European Union offer to eliminate tariffs on all industrial goods traded with the U.S. As a result, his 20% tariff on all EU imports is set to take effect.
Trump, while addressing the press at the White House, stated that European Commission President Ursula von der Leyen’s proposal does not suffice to restore the transatlantic trading relationship. He claimed that the EU continues to impose other trade barriers.
What sectors will be hit by Europe’s new tariffs?
The European Commission abandoned its plan for a 50% retaliatory tariff on American whiskey, related to an earlier dispute over Trump’s recent imposition of levies on aluminum and steel imports.
Instead, the commission suggests tariffs on various US products, including diamonds, motorcycles, pleasure boats, household appliances, safety glass, playing cards, tobacco, poultry, and other agricultural items.
According to Bloomberg, most face a 25% tariff, while a select few will encounter a 10% rate. Several member states advocated for the exclusion of whiskey after Trump threatened to impose a 200% tariff on European wine and champagne producers as a countermeasure. Previously, von der Leyen mentioned that the EU proposed eliminating tariffs on industrial goods, such as automobiles, contingent on the US doing the same; however, Washington has not responded.
What are Trump’s reasons for rejecting the EU deal?
“The European Union has been very bad to us,”
Donald Trump said.
“We’re paying them to guard them militarily and they are screwing us on trade, so that’s not a good combination.”
According to Trump,
” The EU was created primarily to harm US trade.”
He reiterated his grievances that the US bears the cost of Europe’s defense due to insufficient spending by other NATO allies.
Trump also promised to put an additional 50% tariff on Chinese imports on top of two separate levies — of 34% and 20% — that he’d already announced after Beijing announced that it would retaliate.
During his comments on Monday, Trump criticised European trade policy, claiming that the EU restricts access to American cars and agricultural goods, while urging European nations to increase their energy purchases from the US.
What retaliation is Brussels planning against US tariffs?
European Trade Commissioner Maros Sefcovic showed readiness to take up talks on non-tariff issues at the request of the US on condition that it is mutually beneficial for both sides. Nevertheless, he clarified that value-added tax, which has become a target in Trump’s complaints, is very important to be a source of revenue for members, and it will not change.
During their meeting in Luxembourg on Monday, EU trade ministers expressed their willingness to implement a wide range of countermeasures, such as possible taxes on US tech companies, in reaction to the extensive tariffs that have caused global markets to plummet since Trump’s announcement.
All 27 EU members endorsed the commission’s strategy in Luxembourg to negotiate and prepare countermeasures in case negotiations do not succeed, providing a strong mandate for the commission to proceed with its plans, according to senior EU diplomats. “While the EU remains open and prefers negotiations, we will not wait endlessly,” Sefcovic told reporters.
