EU readies ‘sledgehammer’ against Trump tariffs

The EU is expected to hit back hard if U.S. President Donald Trump imposes 25 percent global steel and aluminum tariffs as planned on Wednesday, three diplomats briefed on the matter told POLITICO.

The EU has a retaliation package ready to go that dates back to Trump’s first term, including tariffs on iconic American products such as Harley-Davidson motorcycles, bourbon and jeans. If Brussels does nothing, these will kick in again at the end of the month. But it will probably go beyond that, the diplomats said.

“They will probably go full sledgehammer because they are so fed up with Trump,” said a European steel industry representative, commenting on the European Commission’s expected response. They, along with the diplomats, were granted anonymity to discuss the EU executive’s closely held deliberations.

In announcements so far, the White House has said it will make the new tariffs much broader and costlier, meaning the EU will need to up the ante as well.

The 27-nation bloc — a common market spanning 450 million people — will want to send an unmistakable message that the EU is serious about defending its economic interests should Trump fire the first shot in a trade war.

The United Kingdom, meanwhile, is keeping a low profile. “We’re not going to have a kneejerk reaction,” said an official from the Department for Business and Trade, pointing out that No. 10 is emphasizing the U.K. will “continue to take a cool-headed approach” to tariffs and to Trump’s antagonistic trade policy.

The EU will also no longer enjoy the quotas extended under the former administration of President Joe Biden, which allowed it to export tariff-free to the U.S. Meanwhile, Trump is adding products made mostly with steel — such as bolts and radiators — to the list of goods subject to tariffs; the implications for these "derivatives" are not yet fully understood, but it could affect around €7 billion in EU exports to the U.S.