Europe wants Trump tariffs to reach a deal, but prepare for the worst


Paul Kirby and Laura Gozzi

BBC News

European Commission/Dati Bendo/Handouts Responsible for European CommissionEuropean Commission/Bento/Handout Data

European Commission President Ursula von der Leyen has proposed the initial countermeasures

European leaders have been preparing for the “Trump trade war” – but the reality of a 20% blanket of U.S. tariffs are still shocking.

“This decision is a disaster for the economic world,” French Prime Minister François Bayrou said.

“The consequences will be feared for millions of people around the world,” said European Commission Director Ursula von der Leyen.

The EU’s message is a response on behalf of its 27 member states. The mission is that Europe is ready to negotiate with the United States, but also ready to fight back.

Europe “calibrates” its response

EU Trade Commissioner Maros Sefcovic aims to speak with his U.S. counterparts on Friday.

“When we calibrate our reactions, we will act in a calm, careful unified, unified way, while giving enough time to talk,” he said.

For every European country, President Donald Trump’s tariffs will be a serious blow, and national governments have been working to alleviate fears about industry and business.

Giorgia Meloni, of Italy (until Wednesday) seemed less willing to retaliate against the United States than others – cleaned up her diary and hurriedly called ministers and business leaders to the emergency summit.

Alessandro Apolito of Coldiretti, the country’s major farmer organization, told the BBC that Italy exported 1.6 billion euros (£1.35 billion) of agricultural production products and 20 billion euros worth of wine to the United States.

He said that in addition to economic losses, American consumers will seek the risk of imitating and capturing the market share of otherwise authentic Italian products.

In Spain, Prime Minister Pedro Sánchez rejected Trump’s claim that the EU imposes a 39% tariff on U.S. goods, which is actually only 3%.

“It’s just an excuse to punish the country and implement sterile protectionism. The trade war will affect everyone, but most importantly, it will hit the biggest trade war.”

European companies hold their breath

The Spanish Chamber of Commerce is concerned about exporting 14% to the United States, especially in mechanical and electrical equipment. Sánchez announced a €14.1 billion response plan to help businesses acquire finance and find new markets outside the United States.

Slovaks are more susceptible to exposure than most EU countries because of their reliance on industrial exports, and some economists warn that the depth of economic output has dropped by at least 2.5%.

Polish Prime Minister Donald Tusk warned that economic output potential is 0.4% this year.

Even before Trump announced the news, the French government lowered its expected growth this year to 0.7%.

The French wine and spirits sector in particular may be hit. Jérôme Bauer, head of one of the major wine organizations, warned that the net loss was 1 billion euros (£835 million) in the French wine industry.

Italian winemakers also held their breath.

“We have stopped exporting for nearly two weeks. Everything is paralyzed because customers have not placed orders and importers are not importing,” said Stefano Leone of the Marchesi Antinori, a brewery in Tuscany.

The U.S. accounts for 12% to 13% of total sales, and Leone says the company is in trouble.

“We are waiting to understand the decision to be made, which also depends on any EU countermeasures against the United States. We hope that some form of negotiation will be held and result in specific results.”

Sentiment in European markets is frustrating as investors sell stocks considered to be the most vulnerable to Trump tariffs. Adidas, one of the largest German companies, saw 12% of its value disappear from the stock market.

Small companies and large companies will be hit.

Rocco Mangiaracina, olive grower in green t-shirt posing in front of a basket of olivesRocco Mangiaracina

Rocco Mangiaracina said U.S. tariffs will be in direct contact with his family business

“This is our first year since we started exporting to the United States, and the impact of tariffs on us is more direct,” Rocco Mangiaracina said.

“Only a week ago, we sent our first 900 bottles to the U.S. market.”

“We are ready for this trade war” but added: “The (European) unions must be strong and must unite for it.”

Germany, Europe’s largest economy, quickly called for “an unprecedented attack on international trading systems, free trade and global supply chains”.

But Germany is still waiting for greetings to form the government, so acting Prime Minister Olaf Scholz pointed out that “the world’s most powerful internal market has 450 million consumers” has provided power for Europe.

So how will the EU respond and maintain unity?

Two-step revenge

It has proposed the measurement response.

Starting in mid-April, the first pack of U.S. goods is worth 26 billion euros in retaliation for 25% of U.S. tariffs on EU steel and aluminum exports, which were announced in March. These have been put back in place to provide space for negotiated solutions. If they keep moving forward, they will cover a wide range of agriculture, food and textiles.

Larger countermeasures to be carried out by the end of April are currently being discussed.

In Von der Leyen’s words, Europe “has a lot of cards.” Further measures include not only U.S. goods, but also their digital services.

According to Brussels, Trump complained about the U.S. trade deficit with the EU, but the U.S. trade surplus with the EU has 100.9 billion euros.

If the EU decides to impose tariffs on large technical services or limit or limit our chances of obtaining public contracts, it is possible to use something that some people tag their “big liquor” – more Dry ones are called carbon anti-carbon instruments (ACI).

This will require the majority support of EU member states, but it is a powerful weapon when European operations are under threat.

Peter Dige Thagesen, director of geopolitics at the Danish Industrial Commission, told the BBC that Trump “throws grenades into global trade, creating huge uncertainty.”

He said U.S. tariffs will hit the smallest company with the toughest exports to the United States. While the EU must respond proportionally, he said negotiations must continue to avoid a deeper trade war.

While most European leaders promptly condemn US tariffs, Hungarian Foreign Minister Peter Szijjarto blamed the EU’s footsteps. Hungarian leader Viktor Orban is widely regarded as Trump’s biggest ally in Europe.

“Another proven that in Brussels, incompetent people are leading European institutions, and they also suffer from very severe Trump phobia,” Szijjarto said.

Although Norway is not a member of the EU, Prime Minister Jonas Gahr Store said the U.S. decision to impose a 15% tariff is “bad news” that will have an impact on many Norwegian companies and jobs.

Norway is primarily exporter and finance minister Jens Stoltenberg fears it could be hit by a “triple squeeze”. Not only Trump’s tariffs and reduced growth, but also depends on EU countermeasures.

This could be a trade war with many casualties.

Other reports by Giulia Tommasi in Rome.



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