The European Commission has initiated a public consultation concerning a list of U.S. imports, which could be subject to EU retaliatory measures if ongoing negotiations fail to achieve a mutually beneficial solution and the removal of U.S.-imposed tariffs on European products, according to an announcement today by the institution.
The issue involves a “wide range of industrial and agricultural goods” exported from the United States to the EU, valued at 95 billion euros.
Additionally, potential restrictions could affect certain EU exports to the United States, worth 4.4 billion euros, including scrap steel and chemicals.
Political and technical negotiations are currently underway between Brussels and Washington, but the EU has already started preparing possible retaliatory measures to protect its consumers and industry should the negotiations not conclude satisfactorily, as stated by the European Commission in a press release.
Thus, the EU is launching a lawsuit at the World Trade Organization (WTO) against the United States by formally submitting a request for consultation.
The EU firmly believes that these tariffs severely violate fundamental WTO rules. The EU’s aim is to reaffirm that internationally agreed rules must be respected and cannot be unilaterally disregarded by any member of the organization, it is further indicated.
The public consultation will run until June 10.
The announcement comes amidst heightened trade tensions following Donald Trump’s announcements of imposing 25% tariffs on European steel, aluminum, and vehicles and 20% reciprocal tariffs on the EU, the latter having been suspended for 90 days.
The suspension has calmed markets, which had experienced significant losses, and was welcomed by the EU, which, during the same period and until mid-July, suspended the 25% tariffs on American products in response to U.S. tariffs on European steel and aluminum.
The European Commission, holding the authority over the EU’s trade policy, has opted for caution, supported by countries like Portugal.
During this 90-day pause, Brussels aims to negotiate with Washington, having already proposed zero tariffs on industrial goods in trade between both blocs.
Currently, 379 billion euros in EU exports to the United States, accounting for 70% of the total, are subject to the new tariffs (including the temporarily suspended ones) since the new U.S. administration took office.
These tariffs are increasing business costs, slowing economic growth, fueling inflation, and heightening economic uncertainty.
European Commission calculations indicate that the new U.S. tariffs could result in GDP losses of 0.8% to 1.4% in the U.S. by 2027, with this percentage being 0.2% of GDP for the EU.
In the worst-case scenario, that is, if the tariffs are permanent or other countermeasures arise, the economic consequences will be more severe, between 3.1% and 3.3% for the United States and 0.5% to 0.6% for the EU.
Globally, the European executive estimates a 1.2% loss in global GDP and a 7.7% drop in world trade over three years.
