Faced with Trump’s avalanche of customs duties, the EU must defend its interests while expanding its horizons to new economic partners.
Unloading a container carrier at the Barcelona container terminal, operated by APM Terminals, in Barcelona on January 13, 2025
These trade barriers had however experienced a downward trend since the end of the Second World War. Shortly after the inauguration of his second term, Donald Trump triggered a tidal wave of customs tariffs. Definitely, he is carrying out his self -proclaimed nickname “Tariff Man”. However, these taxes no longer constitute a major source of tax revenue for most countries for a long time.
Today, the EU, barely out of a period of high inflation and energy shortage, but still in the grip of geopolitical crises, sees its American ally brandish the tariff mass. In this unstable context, questions are essential: how does the EU, respectful of multilateral commercial rules, must make its choice? Is the American market really essential? It may be time for the EU, in search of economic risk reduction, to diversify its trade relations.
The impact for the EU and its response
On February 26, the American president announced, during a cabinet meeting, his intention to impose customs duties of 25 % on all European products, especially on cars and food products. Faced with this threat, the European Commission said it would react “firmly and immediately” with the twenty-seven. Bernd Lange, president of the International Trade Committee in the European Parliament, also spoke of the possibility of restoring punitive commercial measures with regard to the United States, suspended in the Biden era in reciprocal reduction in customs duties.
On March 12, the first salvo of customs duties of 25 % wanted by Donald Trump fell on European steel and aluminum. Immediately, the EU replied by taxing a range of American products such as motorcycles, jeans, peanut butter and bourbon whiskey. These reprisals are reminiscent of its strategy adopted under the first mandate of Trump, when surcharge was imposed on steel and aluminum under section 232 of the American law on trade in 1962. The objective was clear: to strike the republican states and traditional export -demand products to weaken their competitiveness on the European market.
Faced with Donald Trump, who signs executive orders in turn to establish surcharge, the EU risks ending up on the hot seat, due to its complex tariff decision mechanism and the high dependence of its economy in foreign trade. Depending on the global economic prospects published by the World Bank in January, the euro area recorded in 2022 growth in its real GDP of 3.5 %, thus exceeding that of the United States of a percentage point. However, this growth dropped to 0.4 % in 2023 and 0.7 % in 2024, while that of the United States was 2.9 % and 2.8 %. According to the World Bank forecasts for 2025, drawn up before Trump even announces its new taxes of 25 %, growth in the euro zone should come close to 1.0 % against 2.3 % across the Atlantic.
This tariff war causes concerns in Europe. Henrik Adam, President of Eurofer, the Professional Association of Garfroaders, estimates that the EU could lose up to 3.7 million tonnes of exports. According to the United Nations Comtrade database, EU exports and imports to and from the United States amounted to 535.85 billion and 366.15 billion dollars in 2023, a respective increase of 41.2 % and 39.2 % compared to 2013. These growth rates exceed 21.8 and 18.1 points those of its total exports and same period. This testifies to the fact that the United States remains one of the most important business partners in the EU.
In 2023, EU exports to the United States represented 19.4 % of its total exports, 10.8 points more than those to China; Its imports from the United States represented 13.5 % of its total imports, 7 points less than those from China, on the other hand up 1.7 points compared to the previous year. Although the EU trade balance has experienced notable fluctuations between 2013 and 2023, including three deficits between 2018 and 2023, it has always maintained a trade surplus with the United States, which increased from $ 116.57 billion to $ 169.7 billion. In recent years, faced with the geopolitical shocks of the Russo-Ukrainian conflict, the EU has strengthened its transatlantic economic ties, increasing its imports of American energy and its exports to the United States. If the increase in American customs duties is applied to all European products, the EU will be exposed to considerable risks.
View of the Levi’s store in Via Del Corso in Rome on March 12, 2025. The EU announced the taxation of customs duties on emblematic American products such as Harley-Davidson, Bourbon whiskey and jeans in response to President Trump customs duties on steel and aluminum.
Strengthen links with the Chinese market
In 2025, the global trade system faced major challenges, marked by the rise of unilateralism and protectionism. In addition to retaliatory measures, proactive actions must be carried out in order to build a new model facilitating the rebalancing of supply chains. Despite the evolution of economic globalization, international trade remains a means of exchanging advantages and retains substantial growth potential. The EU has a unique position in industrial and world supply chains, and its integrated market has played an essential role in optimizing resources allocation in recent decades. Strengthening links with markets such as China and establishing commercial relations with partners who respect multilateral rules helps to mitigate the commercial risks of the EU.
Before Trump’s first term, China and the EU had already agreed to promote the reciprocal opening of the market, including in terms of investment. If these two major economies can establish such stable bilateral rules and mechanisms, companies will have more confidence in long -term development and cooperation. In sectors such as electric vehicles, the digital economy and artificial intelligence, the EU not only has the will, but also the favorable conditions to engage.
Ursula von der Leyen speaks of “deriscking” for the European economy, a necessity in the face of the current main risk: American commercial interventionism and the excessive dependence of the EU vis-à-vis transatlantic exchanges. However, the United States is far from the only possible partner, whether in the energy or automotive sectors. A strengthened Sino-European cooperation, a facilitated circulation of market factors and an opposition to the abusive invocation of national security would provide more effective solutions for the European market. This would support the EU climate commitments and the sustainable development of its green economy, while allowing China to access more European quality products. More importantly, this cooperation would strengthen the stability of the global trade system and encourage other countries to fully engage in economic globalization, creating better conditions to stimulate innovative development through larger markets and wider consensus.
*Zhou Mi is a researcher at the Chinese Academy of International Trade and Economic Cooperation under the Ministry of Commerce.
