The European Union (EU) is preparing its strongest trade measures ever against the US, after President Donald Trump threatened to impose a 30% tariff on all EU exports to the US from August 1 if a trade deal is not reached.
According to a list released by Politico on July 14, the European Commission proposed to impose a retaliatory tax of up to €72 billion on US imports, including key items such as aircraft, cars, auto components, chemicals, food, medical equipment and industrial plastic.
The biggest target in the 200-page list is the US aviation industry, with nearly 11 billion euros worth of aircraft and components subject to high tariffs. This is considered a direct blow to Boeing, in the context that the airline is facing difficulties in supply chains and fierce competition from its rival Airbus.
Followed by automobiles and components, industrial machinery, electronics and chemical waste - all of which are among the top exporters of the US to Europe. The group of industrial goods alone accounts for about 65.7 billion euros in the total list.
Notably, the list still retains the Whiskey Bourbon, despite strong pressure from France and Ireland asks to eliminate to protect the beverage industry.
The food group - especially beef, chicken and processed agricultural products - worth about 6.4 billion euros - is also in Brussels' "visioncast" if EU member states turn the green light on this tax package.
In its document to member countries, the European Commission emphasized that the selection principle is to "re-balance the playing field" after the US continuously raises tariffs on EU goods. The targeted items are all products that can find alternative sources inside or outside the EU and are at high risk of forcing US businesses to shift their supply chains.
We do not want to escalate tensions but we will not rest assured to watch, said a European official.
The EU had previously planned to impose tariffs on up to €95 billion in US goods but reduced them to €72 billion to show goodwill for negotiations. A portion of this - worth 21 billion euros - has been delayed until August 6 to create an opportunity for the two sides to reach an agreement.
The new measures still require official approval from EU member states. Although the voting time has not been set, the bloc's trade ministers have agreed to support the Committee's current negotiation strategy.
