Trump argues that trade agreements in the past have been made too much in favor of foreign partners. The president points specifically to Canada, Mexico, and the European Union as parties that, according to him, have had too easy access to the American market. To correct this, he wants to introduce high import tariffs. This is also intended to protect American manufacturers.
Analysts see this as a signal of protectionism and possibly higher import duties. This could lead to market disruptions on the international stage. Trump has long criticized what he calls 'unfair trade practices'.
Critics question the effectiveness of higher tariffs. They argue that consumers ultimately pay the price because companies pass on the extra import costs in the sales price. Moreover, an increase in protectionism could result in the European Union and other trade partners raising their own import tariffs or imposing other retaliatory measures.
The threat of higher American import tariffs poses a considerable challenge for the EU. The internal market is heavily dependent on exports, particularly in sectors such as agriculture and manufacturing. Other sectors, such as aviation, high tech, and the pharmaceutical industry, are also concerned.
On a political level, there is division within the EU about the appropriate response. Some want to ease tensions through diplomatic means, while others advocate for a strong response, for example by raising tariffs on American products themselves. Combined, the EU could demonstrate its willingness to defend its internal market.
European leaders, including Commission President Ursula von der Leyen, have indicated their willingness to engage in talks. For now, it is unclear whether Trump will put his threats into practice. Next week, an EU summit of heads of government will be held in Brussels, with two key agenda items: addressing the Russian war in Ukraine, and preventing a trade war with the Americans.