Trade War Reloaded: EU Sharpens €72 Billion Counterstrike as US Tariff Threat Looms

The European Union is finalizing a sweeping countermeasure package targeting up to €72 billion worth of US goods, following President Trump’s threat to impose 30% tariffs on EU imports starting August 1.

Key developments:

- EU has extended its suspension of retaliatory tariffs until early August to allow negotiations to continue

- A second list of countermeasures is being prepared, focusing on aircraft, automobiles, medical devices, and agricultural products

- Germany and Denmark have called the US tariff threat “absolutely unacceptable,” urging serious negotiations

- Italy has proposed a €21 billion tariff list if talks collapse

- EU’s Anti-Coercion Instrument remains unused but is being monitored as a last resort

Strategic context:

- The EU aims to avoid a tit-for-tat escalation while preparing proportionate responses

- Brussels is also exploring WTO action and alternative trade routes with Asia and Latin America

- European industries, especially wine, electronics, and auto sectors, brace for potential fallout

Sources: Reuters, Politico, Economic Times, MSN, GVWire, Brussels Post, South China Morning Post, EY Global, Mayer Brown