European Union officials are taking a two-part approach to President Trump’s unfolding trade war, offering to slash tariffs on American-made cars and industrial products even as they prepare to retaliate imminently with wide-ranging levies.
Ursula von der Leyen, president of the EU’s executive branch, said on Monday that the 27-nation bloc would be willing to employ a “zero-for-zero” approach on products including cars, eliminating tariffs on the goods if the United States did the same. EU car tariffs are currently set at 10 percent.
But at the same time, both she and the EU trade commissioner, Maros Sefcovic, made it clear that European officials were preparing to deploy tariffs and, potentially, other trade barriers to hit back at the United States if the two sides could not reach a deal. Those tariffs are set to begin within days.
European Union officials circulated on Monday evening in Brussels a list of products that they plan to hit with retaliatory tariffs, said Olof Gill, trade spokesman for the European Commission, the bloc’s executive branch. Representatives from across the bloc’s member states are expected to vote on that list on Wednesday. If approved, the fresh tariffs would take force in two waves — one on April 15, the second a month later.
Officials did not immediately make the list public.
The tariffs would mark the EU’s first concrete reaction to Mr. Trump’s volley of recent trade measures. They would specifically respond to US steel and aluminum tariffs that took effect in mid-March, and officials have said they would be only a first step. European policymakers are contemplating how to react to Mr. Trump’s subsequent moves, including his 25 percent tariffs on automobiles and the 20 percent across-the-board tariff on EU goods that he announced last week.
The bloc’s first set of retaliatory tariffs was expected to be sweeping, though somewhat dialed back from what was originally planned.
Europe’s gamble on simultaneously employing carrots and sticks to prod the Trump administration toward the negotiating table could have big reverberations for the world economy.
If a deal is struck, it could foster more unrestrained trade flows between two of the world’s largest markets and most important trading partners. If the conflict instead leads to escalating tension and worsening relations, it could help fuel a trade war that causes painful fallout for consumers and companies on both sides of the Atlantic.
“We are fully prepared to sit at the negotiation table whenever our American partners are ready,” Mr. Sefcovic said on Monday in Luxembourg. He had what he described as a “frank” two-hour meeting with his American counterparts late last week.
“While the EU remains open to and strongly prefers negotiations, we will not wait,” he added. “We are prepared to use every tool in our trade defense arsenal.”
European officials are cognizant that an all-out trade war could be painful on both sides of the Atlantic.
“They have played it smart thus far by not getting dragged into an escalatory spiral,” said Jorn Fleck, senior director with the Europe Center at the Atlantic Council, explaining that for Europe part of the game is waiting until the pain of trade disruptions begin to bite in the United States, while showing a willingness to react with strength.
Officials took time to edit the first set of retaliatory lists because they wanted to take into account feedback from across the continent.
Part of the list was originally meant to take hold on March 31. It was instead delayed for further refinement after Mr. Trump threatened his 200 percent tariff on all European alcohol.
Some Northern European countries have been adamant that the European Union must be forceful in its response — even pushing for the EU to use a powerful new trade tool to erect trade barriers on services, potentially targeting big American technology companies like Google.
But other European leaders have been more reluctant to hit back so hard. The Italian prime minister, Giorgia Meloni, has called the idea that Italy must choose between the United States and the bloc “childish.” She has also cautioned against harsh retaliation.
Officials from across the 27-member bloc have been united on one point: They would like to negotiate. But part of the challenge is that the United States has shown little appetite for a quick deal.
American officials seem to view the tariffs “not as a tactical step, but as a corrective,” Mr. Sefcovic said on Monday.
Nor are the ultimate goals entirely clear.
Elon Musk, the technology entrepreneur and Mr. Trump’s close adviser, said on Saturday, speaking during a videoconference appearance with Italy’s far-right League party in Florence. that he hoped that Europe and the United States would move “to a zero-tariff situation, effectively creating a free-trade zone.”
But Peter Navarro, the White House trade adviser, on Monday urged the European Union to drop its value-added taxes and restrictions on American meat that is produced with hormones or other chemicals.
“You steal from the American people every which way is possible,” he said. “So don’t just say we’re going to lower our tariffs.”
The New York Times
