EU targets US beef, whiskey, motorcycles in retaliation to Trump tariffs

Brussels: The European Union on Thursday (AEDT) announced retaliatory trade action with new duties on US industrial and farm products, responding within hours to the Trump administration’s increase in tariffs on all steel and aluminum imports to 25 per cent.

The world’s biggest trading bloc was expecting the US tariffs and prepared in advance, but the measures still place great strain on already tense trans-Atlantic relations. Only last month, Washington warned Europe that it would have to take care of its own security in the future.

EU officials have made clear that the tariffs are aimed at products made in Republican-held states, such as beef and poultry.Credit: AP

The EU measures will cover goods from the United States worth around 26 billion euros ($45 billion), and not just steel and aluminum products, but also textiles, home appliances and agricultural goods. Motorcycles, bourbon, peanut butter and jeans will also be hit, as they were during US President Donald Trump’s first term.

The EU duties aim for pressure points in the US while minimising additional damage to Europe. EU officials have made clear that the tariffs – taxes on imports – are aimed at products made in Republican-held states, such as beef and poultry from Kansas and Nebraska and wood products from Alabama and Georgia. Yet the tariffs will also hit blue states such as Illinois, the No.1 US producer of soybeans, which is also on the list.

Spirits producers have in essence become collateral damage in the dispute over steel and aluminum; the EU is a major destination for US whiskey, with exports surging 60 per cent in the past three years after an earlier set of tariffs was suspended.

British Prime Minister Keir Starmer has also expressed disappointment over the Trump tariffs, and said a retaliatory response was possible.

The European Union is a major destination for American whiskey.Credit: AP

During his weekly questioning in the House of Commons, Starmer said his government was taking a “pragmatic approach” but “we will keep all options on the table.”

Starmer, leader of the centre-left Labour Party, said negotiations with the Trump administration over a bilateral trade deal were ongoing.

European Commission President Ursula von der Leyen said in a statement that the bloc “will always remain open to negotiation.”

“As the US are applying tariffs worth 28 billion dollars, we are responding with countermeasures worth 26 billion euros,” she said. The commission manages trade and commercial conflicts on behalf of the 27 EU member countries.

“We firmly believe that in a world fraught with geopolitical and economic uncertainties, it is not in our common interest to burden our economies with tariffs,” von der Leyen said.

Trump said that his taxes would help create US factory jobs, but von der Leyen said: “Jobs are at stake. Prices will go up. In Europe and in the United States.”

“We deeply regret this measure. Tariffs are taxes. They are bad for business, and even worse for consumers. These tariffs are disrupting supply chains. They bring uncertainty for the economy,” she said.

What will actually happen?

Trump slapped similar tariffs on EU steel and aluminum during his first term in office, which enraged European and other allies. The EU also imposed countermeasures in retaliation at the time, raising tariffs on US-made motorcycles, bourbon, peanut butter and jeans, among other items.

This time, the EU action will involve two steps. First on April 1, the commission will reintroduce what it calls “rebalancing measures,” which the EU had from 2018 and 2020, but which were suspended under the Biden administration. Then on April 13 come the additional duties targeting 18 billion euros ($31.1 billion) in US exports to the bloc.

EU Trade Commissioner Maros Sefcovic travelled to Washington last month in an effort to head off the tariffs, meeting with US Commerce Secretary Howard Lutnick and other top trade officials.

He said on Wednesday that it became clear during the trip “that the EU is not the problem.”

“I argued to avoid the unnecessary burden of measures and countermeasures, but you need a partner for that. You need both hands to clap,” Sefcovic told reporters at the European Parliament in Strasbourg, France.

The EU could lose up to 3.7 million tons of steel exports, according to the European steel association Eurofer. The US is the second-biggest export market for EU steel producers, representing 16 per cent of the total EU steel exports.

The EU estimates that annual trade volume between both sides stands at about $US1.5 trillion ($2.4 trillion), representing around 30 per cent of global trade. While the bloc has a substantial export surplus in goods, it says that is partly offset by the US surplus in the trade of services.

AP

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