On April 7, 2025, European Union (EU) ministers agreed to prioritize diplomatic negotiations with the United States in an effort to remove the high tariffs imposed by President Donald Trump. These include 25% duties on steel, aluminum, and automobiles, and 20% tariffs on most other goods.
Rather than retaliate immediately, the EU is seeking dialogue to avoid escalating into a full-blown trade war. However, the bloc has prepared an initial countermeasure list targeting $28 billion worth of U.S. exports, ranging from dental floss to diamonds.
European Commission President Ursula von der Leyen proposed a “zero-for-zero” industrial tariff agreement, while EU Trade Commissioner Maroš Šefčovič criticized the U.S. tariffs as harmful and unfair. Some member states, like France and Italy, expressed concern over possible U.S. retaliation—such as the threatened 200% tariff on EU wines.
The EU is also considering a broader response by the end of April. Options include invoking the Anti-Coercion Instrument, which could be used to target U.S. services. While some leaders are urging a tough stance, others, such as Ireland, are warning against actions that could escalate the situation further.
Germany emphasized the importance of EU unity, pointing out the U.S. market’s vulnerability—an opinion also echoed by Elon Musk, who supports zero-tariff trade policies.
Despite the EU’s overture, President Trump rejected the “zero-for-zero” proposal, arguing that it would not sufficiently address the longstanding U.S. trade deficit with the EU. He reaffirmed his “America First” stance and indicated a preference to either keep existing tariffs or negotiate more favorable terms for the U.S.
The Trump administration has already imposed sweeping tariffs, including a 25% duty on foreign-made cars and even higher rates on steel and aluminum. EU leaders, including von der Leyen and Šefčovič, reiterated their willingness to negotiate but also warned they were prepared to take retaliatory steps if necessary.
This rejection follows Trump’s “Liberation Day” announcement on April 2, where he declared a 10% global base tariff—sparking volatility in global markets.
In response, the EU reintroduced its industrial tariff elimination offer, which includes automobiles. Von der Leyen stressed this had been offered multiple times before but had not received a proper response from the U.S. The EU still hopes for a negotiated solution, but if no agreement is reached, it plans to gradually implement countermeasures from mid-April to defend its economic interests.
As trade tensions rise, the EU is walking a tightrope—pushing for negotiations while bracing for potential economic fallout, striving to protect its industries and prevent a full-scale trade war with the U.S.
