Differences within the EU over how to respond to President Donald Trump’s barrage of tariffs were laid bare during a meeting of the bloc’s trade ministers on Monday. France urged the EU to contemplate retaliatory measures against American digital services, a move that sparked opposition from Ireland, which is deeply dependent on US investment, especially in the technology sector.
EU trade ministers convened in Luxembourg today, Monday, with the goal of delivering a united and resolute message: the bloc is keen to engage in negotiations with Washington to see the raft of tariffs, unveiled by President Trump on 3 April, lifted.
However, the Union said it is ready to take further countermeasures if negotiations fail.
Diplomats are keen to avoid a split within the EU, particularly following the challenges of Brexit, and are striving for a common stance on this issue.
The move marks an early step in what could escalate into a full-blown global trade conflict, potentially driving up prices for consumers worldwide and pushing economies toward recession.
EU readies response to new US tariffs, France braces for fallout
At the heart of this dispute are the US tariffs on steel, aluminium, and a wide range of other goods.
These measures affect about 70 percent of the EU's exports to the United States, which amounted to €532 billion last year.
The EU is facing 25 percent tariffs on steel and aluminium, as well as reciprocal 20 percent tariffs on a broad array of other goods from Wednesday.
Bourbon versus wine
In response, the European Commission – which coordinates trade policy for the EU – will soon propose a targeted list of US products to hit with additional duties.
Expected to include items like US meat, cereals, wine, wood, clothing, chewing gum, dental floss, vacuum cleaners, and even toilet paper, this list is designed to retaliate against Trump's steel and aluminium tariffs, without immediately extending to the broader measures.
However, one product in particular has raised eyebrows: bourbon.
The Commission has suggested a hefty 50 percent tariff on the iconic American spirit, prompting President Trump to threaten a counter-response that could see EU alcoholic beverages slapped with a massive 200 percent tariff.
For some EU countries, such as France and Italy, the threat to the wine industry is of particular concern.
Both nations are key exporters of wine, and the potential impact of such tariffs could be significant.
Nonetheless, the EU is determined to ensure that its response is as united and effective as possible, with hopes of using these retaliatory measures to push the US back to the negotiating table.
French industry leaders back Macron’s call to freeze US investments
Differences in approach
Within the EU itself, opinions on how to proceed vary.
France has suggested that the EU should consider a comprehensive response, beyond just tariffs, including a freeze on European investments in the US until there is greater clarity.
Meanwhile, Ireland, which exports nearly a third of its goods to the US, has called for a more measured approach, while Italy, a major exporter to the US, has questioned whether retaliatory tariffs are necessary at all.
As it stands, the EU’s counter-tariffs will be put to a vote on Wednesday, with approval all but guaranteed, barring an unlikely veto by a qualified majority of member states.
If approved, the tariffs will be phased in over two stages, with the first wave set to begin on 15 April.
