The European Union has announced plans to impose counter tariffs on €26 billion ($28 billion) worth of US goods beginning next month in response to sweeping US tariffs on steel and aluminium. The move, confirmed by the European Commission, marks a significant escalation in global trade tensions.
US President Donald Trump’s decision to impose a 25% tariff on all steel and aluminium imports came into full effect as previous exemptions and duty-free quotas expired. In response, the EU will lift its suspension of tariffs on US products starting 1 April and plans to introduce additional countermeasures by mid-April.
The reinstated tariffs will target a range of American goods, including boats, bourbon, and motorbikes. The European Commission has also launched a two-week consultation to identify further product categories for retaliatory measures. The new tariffs will apply to around €18 billion worth of goods, with the goal of ensuring that EU countermeasures match the impact of the US tariffs on European exports.
Among the proposed targets are industrial and agricultural products such as textiles, home appliances, plastics, poultry, beef, eggs, dairy, sugar, and vegetables.
European Commission President Ursula von der Leyen defended the measures, stating: “Our countermeasures will be introduced in two steps, starting on 1 April and fully in place as of 13 April. We are ready to engage in meaningful dialogue, and I have entrusted Trade Commissioner Maroš Šefčovič to resume talks with the US to explore better solutions.”
The US tariffs are intended to protect domestic steel and aluminium producers, reviving global duties first imposed in 2018 during Trump’s first term. These tariffs extend to hundreds of downstream products, affecting industries from construction to food packaging.
The US measures have also heightened tensions with Canada, the largest foreign supplier of steel and aluminium to the US. Trump initially threatened to double duties on Canadian exports to 50%, but backed down after Ontario Premier Doug Ford agreed to suspend a planned 25% surcharge on electricity exports to the US. Ford and Canadian Finance Minister Dominic LeBlanc are scheduled to travel to Washington for talks with US officials on revising the US-Mexico-Canada Agreement (USMCA).
Financial markets have reacted nervously to the trade dispute, with US stocks fluctuating amid concerns over economic fallout. The White House, however, defended Trump’s approach. A spokesperson called the tariffs a “win” for American industries, arguing they would restore the strength of the domestic steel sector.
Industry leaders welcomed the enforcement of tariffs. Steel Manufacturers Association President Philip Bell praised the move, stating: “By closing loopholes that have been exploited for years, President Trump will again supercharge a steel industry that stands ready to rebuild America.”
However, the US tariffs are expected to impact major trading partners, including Brazil, Mexico, and South Korea, all of which had previously received exemptions or quota arrangements.
Meanwhile, Canada is considering retaliatory measures, including restricting oil exports to the US or imposing levies on minerals and ethanol. Energy Minister Jonathan Wilkinson warned that if US tariffs remain in place, Canada could target American industries in response.
As the trade war escalates, economists warn of broader economic consequences. A recent survey showed a decline in US small business confidence for the third consecutive month, while a New York Federal Reserve report indicated growing consumer pessimism about finances, inflation, and job security. With global markets on edge, the coming weeks will be critical in determining whether the dispute leads to further escalation or a potential resolution.
