EU Responds with Retaliatory Tariffs on US Imports

TDT | Manama
Email : editor@newsofbahrain.com

In a strong response to newly imposed US tariffs on steel and aluminum, the European Union has unveiled a set of countermeasures aimed at mitigating the impact of the 25% tariff that took effect early on Wednesday morning. The EU’s move targets a wide range of American products, including boats, bourbon, and Harley-Davidson motorcycles.

The European Commission emphasized that these tariffs were a direct reaction to what it described as unjustified and disruptive measures imposed by Washington. European Commission President Ursula von der Leyen expressed regret over the situation, highlighting the negative effects tariffs have on business, supply chains, and consumers. "Tariffs are taxes. They are bad for business, and even worse for consumers," she stated. "These tariffs disrupt supply chains and bring uncertainty for the economy, affecting jobs and raising prices both in Europe and the United States."

The new tariffs stem from a decision by US President Donald Trump, who signed an executive order last month imposing the 25% tariffs on steel, aluminum, and derivative products, which affects about €26 billion worth of EU exports. This move follows a long-standing trade dispute over steel and aluminum tariffs dating back to 2018, which saw the EU retaliating with €2.8 billion in duties on US products.

Two-Step EU Response

The EU's countermeasures will unfold in two stages. On April 1, the EU will allow a suspension of previous countermeasures, which were enacted in response to earlier US tariffs. These measures targeted a variety of products, including boats, bourbon, and motorbikes, and were estimated to cover economic damage amounting to €8 billion.

By mid-April, the EU will introduce a new round of tariffs on US imports, bringing the total value of the EU's retaliation to €26 billion, matching the scale of the US tariffs. The second phase will include a wide array of US products, from industrial goods like steel and aluminum to agricultural products such as poultry, beef, and seafood.

A stakeholder consultation process will run until March 26, allowing industry representatives to provide feedback on the proposed countermeasures. The final legal framework for the tariffs is expected to be established by mid-April.

Negotiation Hopes

Despite the firm stance on retaliatory tariffs, the European Commission remains open to finding a diplomatic solution. von der Leyen emphasized the importance of working towards an alternative resolution, given the broader economic uncertainties faced globally. "In a world fraught with geopolitical and economic uncertainties, it is not in our common interest to burden our economies with tariffs," she said.

EU Trade Commissioner Maroš Šefčovič has been tasked with resuming negotiations with Washington in an attempt to resolve the situation without further escalating tensions.

Ongoing Trade Disputes

This latest flare-up in US-EU trade relations marks another chapter in the ongoing conflict over steel and aluminum tariffs. Previous rounds of negotiations resulted in temporary suspensions of retaliatory tariffs, but the new US measures have reignited tensions, prompting the EU to take decisive action once again. The outcome of the ongoing discussions will be closely watched, as both sides seek to avoid further harm to their economies.