The European Union is gearing up for a possible trade war with the United States after President Donald Trump threatened to impose 30% tariffs on EU goods starting August 1.
While the EU still hopes for a deal, leaders say they're ready to defend their economic interests.
European Commission President Ursula von der Leyen announced on Sunday that the EU would extend its suspension of countermeasures, originally set to expire Monday, to give more time for talks. "We will continue to prepare further countermeasures so we are fully prepared," she said.
According to Irish Independent, the EU has drawn up two rounds of possible tariffs: one hitting €21 billion of US goods and another targeting €72 billion. These measures are ready to go if negotiations fail.
Trump's proposed tariffs shocked EU officials who thought talks were progressing. The US president shared his plan on his Truth Social account over the weekend, adding to growing global trade tensions.He also announced new tariffs on Mexico and Canada.
Germany and France backed von der Leyen's position. German Economy Minister Katherina Reiche warned that the tariffs would hurt businesses on both sides of the Atlantic.
The European Union said it is continuing to push for a trade deal with the US after President Trump said he would be imposing a 30% tariff on most imports from the EU starting August 1 https://t.co/YFZqURhU9l pic.twitter.com/mhp4JG5X8S
— Reuters (@Reuters) July 14, 2025
EU Officials Warn of $9.5 Trillion Trade Risk Over US Tariffs
French President Emmanuel Macron urged the EU to stand strong and defend its interests if needed.
Spain's Economy Ministry echoed this stance, supporting talks but also ready to act. Irish Transport Minister Darragh O'Brien said on Sunday, "We sincerely hope" a trade war can still be avoided, adding that the US and EU "enjoy the biggest economic relationship in the world."
Business groups and experts worry about the impact. The American Chamber of Commerce to the EU warned earlier this year that the dispute could put $9.5 trillion in trade and investment at risk, Reuters said.
Carsten Brzeski from ING said the talks now face a "make-or-break moment," and the EU must decide whether to "budge or play hardball." Economist Cyrus de la Rubia added that US consumers will feel the brunt of any new tariffs.
The European Central Bank has already modeled potential impacts. If the 30% tariffs take effect, eurozone growth could fall by up to one percentage point over the next two years. Inflation could also dip below 2%, below the EU's target.
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