Donald Trump has issued a significant warning to Europe, threatening to impose a 17% tariff on food and farm produce exports to the United States. This move, which emerged from recent talks in Washington, could severely impact popular European goods such as Belgian chocolate, Irish Kerrygold butter, and olive oil from Italy, Spain, and France, all of which are major sellers in the American market. The threat was reportedly delivered to EU trade commissioner Maroš Šefčovič during his meeting with US Treasury Secretary Scott Bessent, Trade Representative Jamieson Greer, and Commerce Secretary Howard Lutnick.
EU ambassadors were swiftly briefed on the potential economic fallout, signaling the gravity of Trump’s aggressive negotiating stance. Despite the escalating tensions, the European Union maintains a preference for a negotiated solution, with spokesperson Olof Gill confirming ongoing progress towards an agreement in principle. However, the EU has also made it clear that it is preparing for a potential trade war, with retaliatory duties on various US products, including Bourbon and Boeing 747s, if an amicable resolution isn’t reached before the upcoming deadline.
This latest tariff threat is consistent with Trump’s broader strategy, as he plans to send letters to approximately a dozen countries, imposing permanent tariffs of up to 70% after his self-imposed July 9 deadline for trade deals. European Commission President Ursula von der Leyen highlighted the difficulty of securing a comprehensive deal within the tight timeframe, instead aiming for a high-level framework agreement. The EU is also seeking immediate tariff relief for critical sectors, particularly the auto industry, which currently faces a substantial 27.5% US tariff.
The 90-day pause on Trump’s “liberation tariffs” concludes for over 60 countries, including the EU, this Wednesday, intensifying pressure on all parties to find a resolution. The stakes are high, with the potential for a full-blown trade war looming if negotiations falter.
