Trump’s decision is a reaction to the apparent failure of recent trade talks between an EU delegation and U.S. authorities. The proposals the European negotiation delegation presented this week in Washington were rejected by the U.S. This makes a new escalation of the trade conflict seem inevitable.
Trump stated that he feels compelled to take action because, according to him, the EU disadvantages American companies. In his announcement, he emphasized that he is no longer willing to tolerate “unfair trade practices” from European countries. Exactly which products will be subject to the new tariffs remains unclear for the time being.
The European Commission has meanwhile stated that it will activate prepared countermeasures if the American tariffs do indeed take effect. Brussels already has a list of American products on which retaliatory tariffs could be imposed. Some suspect Trump is using his threat to apply pressure in those negotiations.
In Europe, the news caused unrest in financial markets. Several European stock indices ended Friday in the red after Trump’s announcement became known. Investors fear a new trade war with negative consequences for economic growth and stability.
The talks between the EU and the U.S. last Friday thus did not lead to a resolution. The positions of both parties were too far apart. According to Politico, the EU wanted to make only limited adjustments, while the U.S. pressed for deeper concessions. This maintained the deadlock.
The European Union says it is considering all scenarios but stresses that dialogue is still possible. However, more and more attention is being given to the possibility of an actual escalation of the trade conflict. The coming days are crucial to whether the new tariffs will actually be implemented.