The European Union on Thursday announced a plan to ramp up the pressure on the United States in hopes of prodding the Trump administration toward serious trade negotiations.
The European Commission, the executive arm of the European Union, announced two major steps that it could take to hit back. Officials laid out 95 billion euros, or $107 billion, worth of goods that they could target with higher tariffs in retaliation to the duties that the United States has announced or imposed. They also said that the bloc would start a World Trade Organization dispute against the United States on both across-the-board tariffs and on duties on cars and car parts.
Neither measure will take effect immediately. Instead, European governments will spend the next month consulting on the list of American products that it could hit with higher tariffs. The proposed list includes some agricultural products, such as soybeans, meats, and bourbon, along with manufactured goods that include sewing machines, airplane parts and car parts. It could also curb Europe’s own exports of key chemicals used in food processing, along with scrap metal.
The European Union did not announce what the tariff rates on those products would be. But if it follows through on its threat, Boeing could be among the companies hit, a senior European official acknowledged. American food companies could also be affected.
By laying the groundwork to retaliate against the United States, the European Union is creating a clear-cut threat that will hang over the Trump administration. European officials still hope to negotiate to avoid lasting tariffs, but no clear solution is in sight, even as the Trump administration prepared to announce a trade agreement with Britain on Thursday afternoon.
“We believe there are good deals to be made for the benefit of consumers and businesses on both sides of the Atlantic,” Ursula von der Leyen, president of the European Commission, said in a statement announcing the plan. “At the same time, we continue preparing for all possibilities, and the consultation launched today will help guide us in this necessary work.”
European Union officials are increasingly moving away from simply talking about how to retaliate and toward talking about a long-term rebalancing of its trade relationship with the United States. That is a recognition that at least some of the new tariffs might remain in place over the long term.
The E.U.’s latest announcement came after several waves of fresh tariffs from the United States were unveiled over the last few months.
The Trump administration has rolled out its trade measures in phases: First, it imposed tariffs on steel and aluminum, then announced them for cars and car parts, and then declared across-the-board tariffs that would applied to different geographies differently. Those so-called “reciprocal” tariffs would have placed a 20 percent tariff on goods coming into the U.S. from the European Union.
The bloc has already taken some actions to respond. Last month, it approved plans for retaliatory measures to the steel and aluminum tariffs that would hit about $23 billion worth of American goods.
But it did so just hours before the Trump administration announced that it would pause the 20 percent across-the-board tariffs for 90 days, applying only a smaller 10 percent duty in their place.
European Union officials responded by pausing their first wave of retaliatory tariffs as a sign of good will. At the same time, officials also made it clear that they would still plan for a broader retaliation in case negotiations stalled.
Thursday’s announcement is a sign that those preparations are continuing.
While Thursday’s list touches only goods, European officials have been clear that if the trade fight deepens, they could hit the American services sector. That is a serious vulnerability for the U.S., since European consumers are major users of American technologies, including cloud computing, search engines and social media.
But many officials see that as a last-ditch option.
For now, the E.U. has been clear that its goal is to negotiate, and that if deal-making is successful, retaliation might be avoidable.
The goal is to have the legal plans ready “in case negotiations with the U.S. do not produce a satisfactory result,” the statement said.
Jeanna Smialek is the Brussels bureau chief for The Times.
The post E.U. Unveils a Plan to Hit Back at the U.S. if Trade Negotiations Fail appeared first on New York Times.
