EU officials said Thursday they would postpone retaliation against President Trump’s steel and aluminum tariffs, including 50% tax on U.S. whiskey and other commodities until mid-next month.
Spokesman Olof Gill said the move was intended to give officials time to refine the list of products that will be hit, while also allowing more time to reach a deal with the United States. The first wave of tariffs in the EU was originally scheduled to work on March 31, with a second wave in a few weeks.
The delay could make officials reconsider whether to impose such a large tariff on sensitive products such as bourbon. As Europe attempts to prevent its trade relations with the United States (arguably the most important globally), it is caused by the trade trade war, which has cost both consumers and companies on both sides of the Atlantic.
“The EU and the United States enjoy the world’s largest bilateral trade and investment relations,” Group Trade Commissioner Maros Sefcovic said in a speech in Brussels on Thursday. “This should be a priority for both sides to protect and further develop such relations.”
Mr. Sevkovic, who negotiated EU trade affairs, spoke with his U.S. counterparts by phone last week. He said Thursday he learned that the Trump administration didn’t want to negotiate trade talks until after April 2, when the United States was expected to announce new and more comprehensive tariffs for its global trading partners.
“For them, this should be the foundation line for redefining and rebuilding trade relations with the rest of the world,” Sevkovic said. “Only then can the partners be able to negotiate possible.”
The delay in negotiations complicated the initial start date of European retaliatory tariffs, which EU policymakers have been hoping would be a tool to get Americans into the negotiation table.
The EU announced its tariff package last week to deal with steel and aluminum tariffs that began on March 12. The European plan was originally intended to take effect in two phases.
The first (now postponed) would allow a series of tariffs reached during Mr. Trump’s first presidency, then suspended during the Biden administration, bringing it back to its place at a higher rate. Whiskey, motorcycles and many other products may be affected.
The second phase will sign new tariffs on a wide variety of U.S. products. Member States aim to consult on the proposed list and present it in a 99-page document covering everything from underwear to soy products to mechanical parts. These tariffs are scheduled to begin in mid-April.
Now, all relevant taxes are expected to be held next month, adding up to €26 billion to Hiftier Levies to about $28 billion, value-value exports.
The slowing process may give officials more time to consider feedback and edit it, which is relevant when the continent’s plans have reached Washington’s rapid and painful response.
Mr. Trump said he would impose a 200% tariff on European champagne, wine and other alcohols to oppose European plans, especially American whiskey.
This threat has alerted the national leaders in European wines. Italian Prime Minister Giorgia Meloni warned that French Prime Minister François Bayrou said there was a risk of “hitting the wrong target”.
Whiskey was originally placed on the tariff list in Mr. Trump’s first trade war in 2018, aimed at Sen. Mitch McConnell, a Republican in Kentucky, then a Kentucky Republican. Bourbon is an important export to his country. But the political calculations surrounding these products have changed with new works by Congress and new leaders around Trump.
Everything may happen before mid-April.
While details remain few of the new tariffs that the U.S. may impose on April 2, Europe has been preparing for their impact. Mr. Trump sometimes threatens that taxes on cars and other products can be as high as 25%, for example, a painful blow to German automakers.
Mr Sevkovic said Thursday that the U.S. could also take further trade measures against copper, timber and shipbuilders.
European Central Bank President Christine Lagarde on Thursday recommended that tariffs be used as “ranspell” and that they could significantly reduce growth in Europe and increase uncertainty over the outlook for price inflation.
But she said it could offset these potential consequences if the EU responds internally and within and with other trading partners.
“Related to global trading partners and within the EU, the answers to the current shift in U.S. trade policy should be more, not less,” Ms. Lagarde said.
