The European Union (EU) has a strong plan to respond to tariffs (taxes on imports) that U.S. President Donald Trump has put in place and plans to put in place. However, they would prefer to talk things out and come to an agreement.
In March, Trump started charging extra tariffs on imported steel and aluminum, and new higher taxes on cars will start soon. He has also hinted at some “reciprocal tariffs,” which means the U.S. could charge back on any tariffs from other countries.
Ursula von der Leyen, the leader of the EU, mentioned that she understands why the U.S. wants to change trade rules, as some countries may have taken advantage of them. The EU has also faced issues in international trade. She noted that U.S. tariffs are like extra taxes for American consumers, which could raise prices and hurt American jobs by making factory parts more expensive.
“Our goal is to find a solution through conversation. But if we need to, we’ll defend our interests and our businesses,” von der Leyen stated in a speech. She added that while the EU does not want to retaliate, they are ready with a strong plan if required.
Additionally, von der Leyen mentioned that the EU should work on trading more with different countries and try to remove obstacles that stop businesses from trading easily within Europe. She pointed out that the International Monetary Fund believes that barriers in the EU’s trade market are like adding up to a 45% tariff on manufacturing and 110% for services.
Next month, the EU plans to propose ideas to reduce some of these barriers and prevent new ones from forming.
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