European Officials Urge ‘Calm’ Facing Trump 50% Tariff Threat

c8o0mli0i9e861f0f8aiovq9_media_dl_1.png European Commission

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(Bloomberg) — European officials sought to portray a unified calm after US President Donald Trump threatened to impose a 50% tariff on the bloc’s imports, a potential escalation that sent stocks tumbling on both sides of the Atlantic on concerns a trade war will disrupt the world’s largest commercial and investment relationship.

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Hours before negotiators in Washington and Brussels were scheduled to hold a call to discuss next steps toward a deal, Trump blasted the European Union in a social media post early Friday for being “difficult to deal with” in “discussions that are going nowhere!”

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Trump’s threat of an additional 30% — on top of his proposed 20% reciprocal rate that’s frozen at 10% until a 90-day suspension ends around July 9 — has echoes of his strategy with China during a tit-for-tat volley last month that wound up with a 145% US tariffs on Chinese imports. He backpedaled when financial markets slumped, and on May 12 announced a reduction of those peak duties for a separate 90-day stretch to give time for negotiations. 

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US Treasury Secretary Scott Bessent, who just concluded meetings with Group of Seven finance ministers in Canada, said on Fox News that “I would hope that this would light a fire under the EU.”

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In response, European officials tried to project restraint and a determination to keep talking, with several using the word “calm” to describe what’s needed as the 27-nation bloc faces the potential for frayed economic ties with its largest trading partner. 

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‘Look Calmly’

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“This is all part of the negotiation,” Dutch Prime Minister Dick Schoof said Friday during a weekly press conference. “We will look calmly at the proposals and respond robustly and firmly.”

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Part of Europe’s challenge is a lack of details about what the US wants. “It remains unclear what the US administration actually expects in order to still strike a deal, other than the earlier contemplated unilateral reduction of EU tariffs,” ING economists Inga Fechner, Carsten Brzeski and Chris Turner wrote in a research note Friday.

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Swedish Finance Minister Elisabeth Svantesson called Trump’s latest pledge “an unreasonable escalation that could harm both the American and European economies,” adding that “we need more free trade, not less.”

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Germany’s new Economics and Trade Minister Katherina Reiche warned of bad outcomes for both sides if the rhetoric becomes policy.

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“There are no winners in tariff disputes,” Reiche told the Rheinische Post newspaper. “We must do everything we can to ensure that the European Commission reaches a negotiated solution with the USA. Such high tariffs damage the US and the EU in equal measure.”

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Irish deputy Prime Minister Simon Harris said negotiations remain the EU and Ireland’s focus. 

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“We need a substantive, calm, measured and comprehensive dialog with the United States,” Harris said. “Our deep and enduring relationship with the United States merits a more sustained and substantive engagement in the period ahead in a bid to bring about a negotiated settlement.”