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EU prepares for potential tariffs in trade dispute with US
The European Commission plans to implement anti-coercion measures if tariff negotiations with the US fail.
The EU is coordinating a strategy to use anti-coercion measures if tariff negotiations with the US stall.
EU prepares for potential tariffs in trade dispute with US
The European Commission is preparing EU member states for the possibility of implementing anti-coercion measures in the ongoing tariff dispute with the United States. These measures may target digital and financial services if an agreement is not reached by August 1. Member states were briefed on this strategy during a recent meeting, which could involve restricting access to public procurement and intellectual property rights for US services. Current discussions between the US and EU include proposals for a baseline tariff of 10% on EU imports, against the backdrop of existing US tariffs of up to 50%, particularly on steel, aluminum, and cars. US President Donald Trump has threatened to escalate tariffs if negotiations do not progress, leading the EU to prepare retaliatory measures worth approximately €93 billion on US products.
Key Takeaways
"While our priority is negotiations, we continue in parallel to prepare for all outcomes including potential additional countermeasures."
EU spokesperson Olof Gill emphasized the importance of preparation in the face of stalled negotiations.
"We need to change our negotiation method. We need to be able to retaliate and to put on the table any option that would change the balance of the negotiation."
French industry minister Marc Ferracci highlighted the need for a stronger negotiating position.
"Intensive technical and political level contact is ongoing."
Olof Gill underscored the constant communication between the EU and US to resolve trade issues.
"Tonight's dinner between Macron and Merz will be decisive to get a qualified majority."
An insider's perspective on the urgency of achieving EU consensus during political talks.
The EU's readiness to utilize anti-coercion measures demonstrates a shift in bargaining strategy that reflects growing tensions in transatlantic trade. As both sides brace for potential escalations, the EU’s approach signals a commitment to taking strong measures in defense of its interests. If implemented, these actions could deepen trade disruption and spark further retaliatory moves, impacting multiple sectors on both sides of the Atlantic. This development underscores the fragility of current discussions and raises the specter of an extended trade war, which could destabilize markets and affect consumers.
Highlights
- The EU is ready to retaliate if negotiations stall.
- A trade war may soon reshape transatlantic relations.
- The balance of negotiation is tipping towards conflict.
- Strategic sectors remain buried in negotiations.
Potential for increased economic conflict
If the EU implements measures as planned, the trade relationship with the US could become even more strained. This situation poses risks not only to trade agreements but also to broader economic stability in both regions.
The situation remains fluid as both parties strategize their next moves in this high-stakes negotiation.
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