The European Union’s executive branch recently responded to U.S. President Donald Trump’s decision to impose tariffs on steel and aluminum. The European Commission stated that Trump’s “reciprocal” trade policy is misguided.
In a statement, the Commission pledged to take “firm and immediate action” against these unjust trade barriers, which they argue undermine fair trade. They emphasized that the EU will continue to protect its businesses, workers, and consumers from unfair tariff measures.
The Commission highlighted that the EU already has some of the lowest tariffs globally and sees no reason for the U.S. to raise tariffs on European exports. They also pointed out that tariffs essentially act as taxes, burdening U.S. citizens, increasing business costs, hindering economic growth, and driving up inflation. Additionally, the Commission stressed that tariffs create economic uncertainty and disrupt global market efficiency and integration.
Earlier this week, the European Commission made it clear that the U.S. tariffs on steel and aluminum would not be left without a response.
It’s still unclear what counteractions the EU will take in response to the U.S. tariffs. During Trump’s first term, similar tariffs on EU steel and aluminum sparked anger among European and other allied nations. In retaliation, the EU imposed its own tariffs on U.S. products, such as motorcycles, bourbon, peanut butter, and jeans.
The EU estimates that annual trade between the two parties is about $1.5 trillion, which makes up around 30% of global trade. While the EU has a significant export surplus in goods, it acknowledges that the U.S. has a surplus in services trade, which balances things out to some extent.
In 2023, trade in goods between the EU and U.S. totaled 851 billion euros ($878 billion), with the EU holding a surplus of 156 billion euros ($161 billion). However, trade in services was valued at 688 billion euros ($710 billion), and the EU faced a deficit of 104 billion euros ($107 billion).