EU Slaps Retaliatory Tariffs On U.S. Amid Trade Tensions

The European Union has announced a series of retaliatory trade measures in response to the U.S. decision to impose a 25% tariff on all steel and aluminum imports. The tariffs, which will also apply to industrial and agricultural products, are set to take effect on April 1.

While the EU had anticipated the U.S. move and made preparations, the decision has heightened already strained relations between the two economic powers. The announcement follows a recent warning from Washington to Europe, urging it to take greater responsibility for its own security in the future.

The EU’s countermeasures will target U.S. goods valued at approximately 26 billion euros ($28 billion), affecting not just steel and aluminum, but also a wide range of products, including textiles, home appliances, and agricultural items.

Notably, the United Kingdom, which is no longer part of the EU, has opted not to impose retaliatory tariffs. The British government expressed disappointment over the U.S. decision but refrained from further escalating the trade dispute.

European Commission President Ursula von der Leyen responded to the U.S. tariffs, stating that the EU would enact countermeasures in response to the 28 billion dollars in U.S. tariffs, underscoring that negotiations remain open. “We 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 EU’s retaliatory measures will include additional tariffs on steel and aluminum products, as well as textiles, leather goods, home appliances, plastics, wood, and a range of agricultural products, including poultry, beef, seafood, nuts, eggs, sugar, and vegetables.

Von der Leyen emphasized the negative economic consequences of these tariffs, warning that both Europe and the U.S. would face higher prices and disrupted supply chains. “Jobs are at stake. Prices will go up. In Europe and in the United States,” she stated. “These tariffs are taxes. They are bad for business and even worse for consumers.”

The European steel industry is particularly vulnerable, with concerns over potential losses exacerbating an already challenging market. Henrik Adam, President of Eurofer, the European steel association, predicted that the EU could lose up to 3.7 million tons of steel exports to the U.S. — a significant blow, as the U.S. is the second-largest export market for EU steel producers.

Adam noted that the loss of such exports would be difficult to offset, as the EU struggles to expand steel exports to other regions.

The U.S. imposed similar tariffs on EU steel and aluminum during President Donald Trump’s first term, sparking widespread anger among European leaders and other global allies. In retaliation, the EU had previously raised tariffs on various U.S. products, including motorcycles, bourbon, peanut butter, and jeans.

The trade volume between the EU and the U.S. is significant, with an estimated annual trade total of $1.5 trillion, representing about 30% of global trade. While the EU enjoys a trade surplus in goods, this is partly offset by a U.S. surplus in the trade of services. In 2023, EU goods trade amounted to 851 billion euros ($878 billion), with a surplus of 156 billion euros ($161 billion), while services trade reached 688 billion euros ($710 billion), with a deficit of 104 billion euros ($107 billion).

Meanwhile, British Business Secretary Jonathan Reynolds indicated that the U.K. would continue to engage with the U.S. to protect British business interests, leaving open the possibility of future retaliatory tariffs. “We will keep all options on the table and won’t hesitate to respond in the national interest,” Reynolds said.

British Prime Minister Keir Starmer, who has worked to maintain strong ties with the U.S., remains focused on negotiating a broader economic agreement with Washington to remove additional tariffs and support the U.K. economy.