Leaders of the European Union have been clear that they want to negotiate trade with the United States to prevent a complete conflict. But without a deal in sight, on Wednesday, civil servants announced a plan that is intended to hit hard when steel and aluminum rates come into effect.
President Trump has imposed 25 percent rates on all global steel and aluminum imports, including products that contain those metals, such as cooking utensils and window frames. Given that breadth, the European Union said that the American taxes can meet around 26 billion euros – $ 28 billion – of the block exports.
So the block announced a plan that is intended to take revenge to almost the same extent.
The reaction comes from two parts. The block had increased rates for a series of goods as a retribution for American measures during the first term of Mr Trump, but they were suspended under the Biden administration. That suspension may expire on 1 April, which increases the rates to $ 4.5 billion in euros in products with boats, bourbon and motorcycles.
The second step of the block would, it said, would be to install rates at around € 18 billion in extra products. Representatives from countries throughout Europe will consult for two weeks before officials complete the list of affected products.
Items proposed for inclusion are industrial and agriculture. They are intended to target products – including soybeans, beef and chicken – that are important exports of Republican strongholds. They include the Louisiana district that Mike Johnson, the speaker of the house, elected.
The aim is to have the new measures in mid -April.
The announcement was the opening movement of Europe in a unfolding trade conflict – one that is generally expected to intensify in the coming month.
For the block, the American steel and aluminum rates are just the beginning of what Mr Trump has threatened. He has sworn repeatedly to set broad rates for US trading partners worldwide soon April 2. He has suggested that taxes on cars can be 25 percent in particular, a figure that would be painful for German and Italian car manufacturers.
“We are now in this escalating spiral,” said Carsten Brzeski, the worldwide head of macro research at the bank.
On the one hand, the European Union does not want to escalate the trade war. European civil servants have called rates 'economically counterproductive', warning that a tit-by-tat rate fight would harm everyone.
“Rates are taxes,” said Ursula von der Leyen, the President of the European Commission, the Executive Arm of the Block, in a television declaration on Wednesday. “Jobs are at stake, prices up, nobody needs that.”
But the Trump government is reluctant to negotiate, which encourages European policymakers to take a more aggressive attitude.
“I traveled to the US last month; I was looking for a constructive dialogue to prevent the unnecessary pain of measures and countermeasures, “said Maros Sefcovic, the best trade officer of the European Commission, during a newsletter this week. “Ultimately, as it is said, one hand cannot clap. The American administration does not seem to be entering into a deal. “
EU leaders emphasized on Wednesday that the reaction of the block is meant to be proportional, and Mr Sefcovic emphasized that they were avoidable “if the American government accepts our extensive hand.”
Mr Trump's rates come at a difficult moment for the European economy. After a few years of marking growth, companies in the block are staring at the prospect of deteriorating trade conditions that can harm their overseas activities.
For example, groups representing the German steel industry have said that the rates come in an 'unlimited time' when producers in the European Union have to deal with cheap competition from China.
At least Europe is not surprised. A trade -oriented group within the European Union, popularly called the 'Trump Task Force', spent a large part of last year preparing various trade conflict scenarios.
But it was difficult for Europeans – and other American trading partners – to decide how to respond. It is also not clear what the goals of Mr Trump are or which will eventually be retained, because his administration has made the habit of threatening and then returning, at least temporarily.
“It is difficult to know what lingers and what will not linger,” said Michael Strain, the director of economic policy studies at the American Enterprise Institute in Washington, which recently organized an event with Mr. Sefcovic.
European officials also have difficulty getting their American counterparts on the phone. Since his inauguration, Mrs. Von der Leyen has not spoken individually with Mr. Trump.
Asked at a press conference on Sunday when she could talk to him, she said, “We will have a personal meeting when time is right.”
Kaja Kallas, the most important diplomat of the Blok, would meet Marco Rubio, the State Secretary of the US State at the end of February, in Washington, but Mr Rubio canceled that meeting.
And diplomats from the entire European Union and its Member States have difficulty identifying who they should talk to in the Trump government, partly due to a lack of clarity about how decisions are made.
“I think there is a level of consternation at the objectives of the administration,” said Jörn Fleck, senior director at the Europe Center of the Atlantic Council, a research institution established in Washington.
He said that Europe might have more difficulty reacting in a world in which the United States does not just want to close a deal, but rather the worldwide trade order to repair fundamentally, so that more is produced in the United States.
“Maybe there is no deal to close,” he said.
