BRUSSELS — The European Union on Wednesday announced retaliatory trade action with a series of duties on U.S. industrial and agricultural products that will go into effect from April 1, responding to the Trump administration increase in tariffs on all steel and aluminum imports to 25%.
The world's biggest trading bloc was expecting the U.S. tariffs and prepared in advance, but the measures still place great strain on already tense transatlantic relations. Only last month, Washington warned Europe that it would have to take care of its own security in the future.
The EU measures will cover goods from the United States worth some 26 billion euros ($28 billion), and not just steel and aluminum products, but also textiles, home appliances and agricultural goods. Motorcycles, bourbon, peanut butter and jeans will be hit, as they were during President Donald Trump's first term.
Britain — which is not part of the EU — meanwhile said it would not impose retaliatory measures of its own on the United States. The U.K. government called Washington's decision to impose 25% tariffs on global steel and aluminum imports "disappointing."
The EU moves to protect itselfEuropean Commission President Ursula von der Leyen said in a statement announcing the measures Wednesday that the bloc "will always remain open to negotiation."
"As the U.S. are applying tariffs worth 28 billion dollars, we are responding with countermeasures worth 26 billion euros," she said. The commission manages trade and commercial conflicts on behalf of the 27 member EU countries.
"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," von der Leyen said.
The commission also said that steel and aluminum products would be hit in return, but also textiles, leather goods, home appliances, household tools, plastics and wood. Agricultural products will also be impacted — including poultry, beef, some seafood, nuts, eggs, sugar and vegetables.
Trump said his taxes would help create U.S. factory jobs, but von der Leyen said: "Jobs are at stake. Prices will go up. In Europe and in the United States."
"We deeply regret this measure. Tariffs are taxes. They are bad for business, and even worse for consumers. These tariffs are disrupting supply chains. They bring uncertainty for the economy," she said.
What will actually happen?Trump slapped similar tariffs on EU steel and aluminum during his first term in office, which enraged European and other allies. The EU also imposed countermeasures in retaliation at the time, raising tariffs on U.S.-made motorcycles, bourbon, peanut butter and jeans, among other items.
This time, the EU action will involve two steps. First, the commission will reintroduce what it calls "rebalancing measures," which the EU had from 2018 and 2020 but which were suspended under the Biden administration, then additional duties targeting 18 billion euros ($19.6 billion) in U.S. exports to the bloc.
EU Trade Commissioner Maroš Šefčovič traveled to Washington last month in an effort to head off the tariffs, meeting with U.S. Commerce Secretary Howard Lutnick and other top trade officials.
He said on Wednesday that it became clear during that trip "that the EU is not the problem."
"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 told reporters at the European Parliament in Strasbourg, France.
European steel companies brace for lossesThe EU could lose up to 3.7 million tons of steel exports, 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 said last month.
The U.S. is the second biggest export market for EU steel producers, representing 16% of the total EU steel exports.
"Losing a significant part of these exports cannot be compensated by EU exports to other markets," Adam said.
Transatlantic tradeThe EU estimates that annual trade volume between both sides stands at about $1.5 trillion, representing some 30% of global trade. While the bloc has a substantial export surplus in goods, it says that is partly offset by the U.S. surplus in the trade of services.
The commission says that trade in goods reached 851 billion euros ($878 billion) in 2023, with a trade surplus of 156 billion euros ($161 billion) for the EU. Trade in services was worth 688 billion euros ($710 billion) with a trade deficit of 104 billion euros ($107 billion) for the EU.
Meanwhile, British Business Secretary Jonathan Reynolds said Wednesday he would "continue to engage closely and productively with the U.S. to press the case for U.K. business interests." He did not rule out future tariffs on U.S. imports, saying "we will keep all options on the table and won't hesitate to respond in the national interest."
Center-left Prime Minister Keir Starmer has worked to build strong ties with Trump, in hope of avoiding the tariffs levied on many other U.S. trading partners.
Reynolds said the government remains "focused on a pragmatic approach and are rapidly negotiating a wider economic agreement with the U.S. to eliminate additional tariffs and to benefit U.K. businesses and our economy."
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