Trump Announces Tariffs on EU and Mexico, Threatening Trade War Escalation

Former President Donald Trump has declared his intention to impose a 30% tariff on goods imported from the European Union and Mexico, effective August 1st. This decision significantly complicates ongoing trade negotiations aimed at preventing a further escalation of the trade conflict. The EU, comprised of 27 nations, had been actively pursuing a comprehensive trade agreement with the United States.

European Commission officials, leading the tariff negotiations, believed a deal was imminent, contingent on Mr. Trump's approval. Their objectives included reducing the existing 25% tariff on vehicles and eliminating levies on items like spirits, aircraft, and related components. The EU had also expressed willingness to decrease its substantial trade surplus in goods, valued at €198 billion, by increasing purchases of US-made weapons and liquefied natural gas.

However, in a letter addressed to EU President Ursula von der Leyen, Mr. Trump announced his plan to triple the initial tariffs he had previously implemented. He stated that the US-EU trade relationship had been "far from Reciprocal." The letter, shared on his social media platform, warned that any retaliatory tariffs imposed by the EU on US products would be met with even higher tariffs in response. He emphasized that the 30% tariff was insufficient to address the trade deficit disparity between the US and the EU.

The letter, dated July 11th, also expressed the US's desire to collaborate with the EU as a trading partner in the future. Simultaneously, in a separate letter to Mexico's leader, Mr. Trump acknowledged Mexico's assistance in curbing the flow of undocumented migrants and fentanyl into the US. However, he asserted that Mexico had not done enough to prevent North America from becoming a "Narco-Trafficking Playground." This announcement follows earlier tariff announcements targeting several other countries, including Japan, South Korea, Canada, and Brazil.