European Union stands poised to retaliate against the tariffs put in place by US President Donald Trump, yet remains willing to reach a diplomatic solution, European Commission President Ursula von der Leyen said on Tuesday.
Addressing the European Parliament in Strasbourg, von der Leyen underlined that although the EU likes to negotiate, it will take action to protect its economic interests. She mentioned that the Trump administration had already imposed tariffs on steel and aluminum imports in March, and further duties on cars were to be imposed on Thursday. Trump also plans to announce plans for wider “reciprocal tariffs” on Wednesday.
Von der Leyen recognized Washington’s grievances regarding perceived global trade imbalances, adding that the EU too had been disadvantaged under the existing system. She also appreciated the US’s drive for re-industrialization, which Europe shared. Nevertheless, she contended that tariffs would end up harming American consumers by increasing prices, driving inflation, and making manufacturing more costly, which could result in job losses.
“Our objective is a negotiated solution,” she said. “But of course, if need be, we will protect our interests, our people, and our companies. We do not necessarily want to retaliate. But if it is necessary, we have a strong plan to retaliate and we will use it.”
Aside from the resolution of external trade matters, von der Leyen called on the EU to make its internal market stronger by lowering barriers to trade within the bloc. She quoted an International Monetary Fund estimate that current market restrictions were tantamount to a 45% tariff on manufacturing and a 110% tariff on services.
To meet this, she said that the European Commission will unveil proposals later this month to eliminate the trade barriers in the EU and stop new barriers from arising.