[Text/Observer Network Liu Chenghui] As the Trump administration's tariffs continue to tighten, EU member states held a ministerial meeting on tariffs in Luxembourg on April 7, which was the first full meeting of the EU since the US announced "reciprocal tariffs".
The European Commission proposed to its member states to impose a 25% tariff on some US imports that day and suggested exempting industrial products between Europe and the US from tariffs. The relevant tariff measures are expected to take effect on April 15, but most of the tariffs are expected to begin collection in mid-May. EU member states will vote on this proposal on the 9th. Vuk Jeremic, the commissioner of the European Commission responsible for trade and economic security, said that he had consulted with member states about the list of goods subject to taxation. The value of American goods targeted by this countermeasure is expected to be lower than the initial $28 billion, and the EU still hopes to negotiate with the US side to cancel tariffs, but it is also prepared to use all countermeasures.
It is worth noting that there is still disagreement within the EU on which "big stick" to use against the US. France, Germany, and Spain advocate not excluding any options, while Ireland and Italy, among others, are more cautious about escalating trade tensions due to significant impacts on related industries. In addition, the EU will also decide this week whether to fine Apple and Meta for violating EU digital competition rules, which could further escalate trade conflicts between the US and the EU.
EU Trade Commissioner: A Countermeasure List Has Been Drafted, but No Tit-for-Tat
According to reports from the Financial Times and "Politico", Jeremic told reporters on the 7th that the series of tariff measures decided by Trump last week would impact EU exports to the US worth 380 billion euros.
He added that in response to the US imposing a 25% tariff on EU steel and aluminum, the European Commission has formulated a countermeasure list, which will be sent to member states later that day. He added, "The decision will be made on the 9th, and the final list will be passed on the 15th, with tariffs on products taking effect on that day."
Vuk Jeremic, the commissioner of the European Commission responsible for trade and economic security. Visual China
Jeremic also told reporters that the EU "does not engage in tit-for-tat or confrontational approaches." The total value of the countermeasures taken by the EU against the US tariff list will not reach the initial $28 billion, as commissioners have been listening to opinions from member states.
He added that the EU still hopes to resolve issues through dialogue and negotiations and cancel tariffs, but if negotiations on tariffs fail to make progress, the EU will use all means to counter the US. "We are ready to use all available tools in our trade defense toolbox to protect the interests of the EU single market, producers, and consumers."
A tax list obtained by the Financial Times shows that after consulting with member states, in addition to bourbon whiskey, wine and dairy products have also been removed from the tax list. Other products, including orange juice, poultry, and soybeans, will be subject to tariffs ranging from 10% to 25%. Trump had threatened that if bourbon whiskey were included in the target list, the US would impose a 200% tariff on European alcohol.
These tariffs will take effect at different times between April 15 and December 1 depending on the product. The tariffs on soybeans and almonds have been postponed until December 1 because farmers opposed taxing soybeans used as animal feed.
"Politico" revealed that the US products listed for a 25% tariff include soybeans, sweet corn, rice, almonds, orange juice, cranberries, tobacco, iron, steel, aluminum, certain types of ships, textiles, and certain clothing, as well as various cosmetics. The affected US exports amount to 22.1 billion euros, which is smaller than the initially planned scale.
European Commission President Ursula von der Leyen said the same day that as part of trade negotiations, the European Commission has proposed an agreement to cancel all industrial product tariffs to the US, covering areas such as automobiles, pharmaceuticals, chemicals, plastics, and machinery. She emphasized that if negotiations fail, she intends to push the EU to retaliate against Trump's tariff policies.
Trump has announced comprehensive tariffs on EU imports and will take effect on April 9 at 20%. Steel, aluminum, and automobiles are subject to separate 25% tariffs. More than 380 billion euros of EU-made products will be affected. Pharmaceuticals, copper, timber, semiconductors, and energy are exempted.
"We are always ready to negotiate with the US. In fact, we have proposed zero tariffs on industrial products, just as we have successfully done with many other trading partners," von der Leyen said. "Because Europe is always ready to reach a good agreement. So we keep it on the table. But we are also prepared to respond with countermeasures to defend our interests."
On April 7, Brussels, Belgium, European Commission President Ursula von der Leyen holds a press conference at the EU headquarters and speaks to journalists. Visual China
Von der Leyen said that Europe has previously proposed a "zero-for-zero" agreement regarding the automotive industry multiple times, but the US side "has not responded appropriately." Von der Leyen said, "We hope to resolve issues through negotiation." She also warned that the European Commission will use "all available tools" for countermeasures when necessary, including the anti-coercion tool (ACI) launched in 2023 but never triggered, to strike back at US technology, banking, and other service sectors.
Von der Leyen described Trump's comprehensive tariffs as a "major turning point for the US," which will impose "huge costs" on US consumers and businesses and cause "serious" damage to the global economy.
Von der Leyen announced the establishment of a new special task force during her speech to closely monitor changes in global commerce.
She said, "We will also protect ourselves from indirect impacts of trade diversion. For this purpose, we will establish an 'import monitoring task force.' We will study our past and current import situations and whether certain products or industries have seen specific surges that require action."
On April 7, Trump said at the White House that selling energy to the EU will become a key focus for the US government to eliminate its trade deficit with the EU.
He criticized European countries for not purchasing enough US goods.
"The EU has been very bad to us," he said. "They will have to buy energy from us because they need energy, and they must buy from us. If they buy (energy), we can cut our $350 billion deficit in a week."
Exactly which "big stick" to use, the EU remains divided.
"Politico" described that although the EU intends to hold trade "heavyweight weapons" for negotiations with the US, internal consensus on whether to pull the trigger has yet to be reached.
A senior EU diplomatic official familiar with the situation said that when Jeremic took an opinion poll on what tools the EU should use, only a few ministers called for all options to be put on the table.
The report said that von der Leyen's proposal to exempt industrial products between Europe and the US from tariffs is considered "carrots," and it is relatively easy to achieve because industrial product tariffs between the US and the EU are already low. As for the "sticks," the EU wants to give the impression of negotiating from a strong position and hopes that financial market turmoil caused by Trump's tariff offensive will weaken the US side's fighting spirit. However, EU capitals differ on exactly which stick to use.
The "anti-coercion tool" (ACI) is an unused "nuclear option" that will empower the EU executive branch with the power to strike back at US tech and banking services.
An EU diplomatic official said that about 20% of EU countries support using all means, including ACI.
France, Germany, and Spain lead the call for the EU not to exclude any options when responding to Trump.
"People must carefully examine the role of ACI," said Economy Minister Robert Habeck, who is soon to leave office, at the meeting on the 7th. "These measures go far beyond customs policy. They cover a wide range of areas, including digital services, but have tools far beyond digital taxes."
Economy Minister Carlos Cuerpo of Spain agreed with this statement. "ACI is a tool we can use as a precaution. We need to explore using all the tools we have. This is certain. We should not exclude any possibilities."
Bourbon whiskey has been removed from the European tax list. Visual China
On the other hand, Ireland and Italy are more cautious about escalating trade tensions with Trump, as their pharmaceutical and wine industries are at the center of the tariff storm.
Ireland's Foreign and Trade Minister Simon Harris is very cautious about invoking ACI or actions targeting US service industries. "I think this will be an extraordinary escalation, and now we must work to de-escalate. In many ways, if we start talking about using ACI-like things, it's a nuclear option."
Italy even proposed delaying the implementation of EU countermeasures from April 15 to April 30.
The European Commission is expected to decide this week whether to fine Apple and Meta for violating EU digital competition rules. This move could further escalate trade tensions between the US and the EU.
"At this stage, I will not delve into specific definitions or speculate about which tools we will use," Jeremic said. "Our response is very gradual, and at this stage, it is only a countermeasure against steel and aluminum tariffs... because we want to create necessary negotiation space."
"However, despite our efforts and openness, so far we have not seen the US truly participate to reach a mutually acceptable solution," he added.
Meanwhile, the impact of Trump's "reciprocal tariffs" policy on the global financial sector continues to unfold. On April 7, the first trading day of the new US week, the US stock market opened and quickly unveiled the beginning of another "Black Monday." Within ten minutes, all three major indices in New York fell by more than 3%.
Just as the market generally continued to see a bearish trend, a message about "suspending tariff collection for 90 days" abruptly pulled the continuously falling US stocks back up.
However, this message was ultimately confirmed by the White House as "fake news," and the US stocks then turned back to fall again.
Despite the partial boost provided by the "fake news," by the close of trading on the 7th, the three major indices did not show widespread gains. Only the Nasdaq gained slightly by 0.1%, the S&P 500 index fell by 0.23%, and the Dow Jones fell by 0.91%.
Late in the evening on the 7th, when questioned at the White House about whether to suspend tariffs for negotiations, Trump replied, "We are not considering these."
Original source: https://www.toutiao.com/article/7490743535252161076/
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