European Union Prepares to Retaliate Against President Trump's Tariffs

The European Union, nearly all of whose member countries have supported a plan to hit back against President Trump's tariffs, is prepared to retaliate with tariffs on over 93 billion euros' worth of U.S. imports if no agreement is reached. This comes as European Union officials voice optimism about a possible trade deal with the United States, with a goal of 15 percent across-the-board tariffs, including on cars and car parts. However, should President Trump follow through on his threat to tax European imports at 30 percent, the European Union has made clear that it is prepared to strike back.

Key Takeaways:

• The European Union has threatened to retaliate against President Trump's tariffs with tariffs on over 93 billion euros' worth of U.S. imports if no agreement is reached.
• The retaliation package combines two separate tariff lists, targeting American goods in response to Mr. Trump's steel and aluminum tariffs, as well as Boeing airplanes and Kentucky bourbon.
• Hungarian was the lone holdout in voting to back a plan to retaliate against President Trump's tariffs.
• The measures will kick in on Aug. 7 unless a satisfactory accord is reached.
• European corporate leaders fear that any retaliation could infuriate Mr. Trump and expose them to even higher U.S. tariffs.
• The European luxury, cosmetics, and food industries have been lobbying in Brussels against enacting any countermeasures.
• The trade negotiations are expected to continue, with negotiators from both sides meeting in Brussels to discuss the potential deal.
• The European Union's retaliation plan includes targeting U.S. goods worth 21 billion euros in response to Mr. Trump's steel and aluminum tariffs.
• The decision of whether to close a trade deal will ultimately fall on President Trump.

Statistics:

• European exports to the United States reached 532 billion euros last year.
• A 10 percent tax on sales of those goods would reduce European growth by around 0.3 percentage points in the first year.
• A 30 percent tax would create a bigger bang, according to an analysis by Oxford Economics.
• The European Union's retaliation package includes tariffs on over 93 billion euros' worth of U.S. imports.
• The measures will kick in on Aug. 7 unless a satisfactory accord is reached.

Sources:

• "European Union officials are voicing optimism about a possible trade deal with the United States" (Fify Hughes, The New York Times)
• "The European Union's retaliation plan includes targeting U.S. goods worth 21 billion euros in response to Mr. Trump's steel and aluminum tariffs" (The New York Times)
• "European corporate leaders fear that any retaliation could infuriate Mr. Trump and expose them to even higher U.S. tariffs" (The New York Times)
• "European exports to the United States reached 532 billion euros last year" (Oxford Economics)
• "A 10 percent tax on sales of those goods would reduce European growth by around 0.3 percentage points in the first year" (Oxford Economics)