The European Union is preparing a major retaliatory response in its escalating trade standoff with the United States. According to EU diplomats, the European Commission has drafted plans to impose tariffs on nearly €100 billion worth of American exports, should ongoing trade negotiations with Washington collapse.
A Strategic Shift in US Trade Policy
Since his return to the White House, President Donald Trump has reaffirmed his administration’s commitment to strengthening American manufacturing and reducing trade imbalances. As part of this policy, the US has maintained a 10% tariff on EU imports, in addition to duties on cars, steel, and aluminum, all aimed at ensuring fairer competition for domestic producers.
While these measures have sparked concern among some EU exporters, they align with Trump’s broader goal of protecting national industries and recalibrating trade agreements to benefit American workers and the economy.
Brussels’ Response: A Calculated Deterrent
In response, the European Commission is exploring a tariff package that could target between €95 to €100 billion in US exports. The plan, still in early development, was shared with EU ambassadors in a confidential meeting last week, with the intention of having a well-prepared fallback option should negotiations stall.
An official involved in the discussion noted, “The objective is not escalation, but readiness. If we don’t reach a fair deal, the EU must also protect its industries.”
A preliminary list of goods is expected to be circulated to EU member states by Thursday, triggering a 30-day consultation process with national governments and key stakeholders. This step ensures the final list considers the diverse economic interests within the bloc.
Lessons from the Past and Current Realities
A similar consultation process took place during the previous US-EU trade discussions under Trump’s first term, when tariffs were first imposed on European steel and aluminum. The EU responded cautiously then, avoiding certain politically sensitive US exports like bourbon whiskey after lobbying from France, Italy, and Ireland.
Today, the European Commission aims to strike a more strategic balance, showing readiness while preserving avenues for diplomatic engagement. Brussels is also offering a parallel list of potential concessions to support a positive outcome in ongoing trade talks.
Economic Implications
The EU estimates that the broader impact of current and past US tariffs touches approximately €549 billion in EU exports. Key sectors affected include automobiles, industrial goods, agriculture, and luxury products.
Despite these challenges, many EU policymakers acknowledge the Trump administration’s consistent and transparent trade philosophy. Rather than a sudden disruption, they view the policy as a structured effort to renegotiate trade terms in a competitive global market.
Diplomatic Engagement Continues
This week, Sabine Weyand, the EU’s top trade negotiator, is leading a high-level technical team in Washington for two days of talks, the first such visit since the Commission began drafting its contingency measures. Both sides are optimistic about identifying shared ground.
Weyand emphasized that the EU remains committed to finding “pragmatic, balanced solutions that work for both sides.”
Trade Reset or Show of Strength?
The EU’s proposed tariffs on up to €100 billion in US goods are not a declaration of confrontation but a demonstration of preparedness. With President Trump pursuing a national-interest-driven trade agenda and the EU looking to defend its own markets, the next phase of negotiations will determine whether these two major economies move toward renewed cooperation or a tactical standoff.
Key Data Points:
- €100B: Potential EU tariffs under consideration
- €549B: EU exports exposed to current and past US tariffs
- 10%: General tariff still applied by the US on EU imports
- 30 days: Consultation period for EU member states to revise the retaliation list
The outcome of this standoff will set the tone for future EU-US trade relations. Brussels’ resolve to prepare for retaliation, even while engaging in diplomacy, signals that the bloc is unwilling to be sidelined in a rapidly changing global trade landscape.
