Trump's tariff may make normal trade impossible, says EU negotiator

Times

5 hours ago

President Trump's threatened 30 per cent tariffs would render usual trade between the US and the European Union 'almost impossible', the bloc's trade negotiator has warned.
Maros Sefcovic issued the warning during talks with European trade ministers, as the EU prepares a €72 billion package of retaliatory measures if the US goes ahead with its tariffs on European exports on August 1.
'If you're talking about 30 per cent or 30 per cent plus, there will be a huge impact on trade,' said Sefcovic, and 'transatlantic supply chains would be heavily affected'. He added: 'It will be almost impossible to continue trading as we are used to in a transatlantic relationship.'
Trump stunned European capitals at the weekend and threw negotiations into disarray with a new threat of 30 per cent tariffs on EU imports, a significant increase on the 20 per cent threatened in April, which was then dropped to 10 per cent pending negotiations.
Sefcovic said that the EU would have little or nothing to lose by retaliating. 'Thirty per cent or anything above 30 per cent, any additional counter-reaction from the United States, has more or less the same effect. Practically, it prohibits trade.'
Following the meeting in Brussels, Sefcovic said: 'The EU never walks away without a genuine effort, especially considering the hard work invested, how close we find ourselves to making a deal and the clear benefits of the negotiated solution. But, it takes two hands to clap.'
He said that the commission would circulate its package of retaliatory 'rebalancing' measures to European capitals for approval. 'We want to use every minute of every day until August 1 to find a solution. We will negotiate first and prepare at the same time.'
• Irwin Stelzer: It's pay to play in Trump's America — tariffs are here to stay
Sefcovic said he would brief EU trade ministers on progress in talks with Washington over the next three weeks.
The European Commission suspended the EU's first package of retaliation tariffs, which would have been worth €21 billion, and has prepared a new €72 billion package, which will probably be held in reserve until the August deadline. Initial proposals had been for €20 billion more.
Friedrich Merz, the German chancellor, and Giorgia Meloni, the Italian prime minister, have both urged that a deal be negotiated, and they have the support of most other EU governments. France has backed a tougher approach.
The German Chamber of Commerce and Industry has calculated that the US tariff policy could reduce German exports to the world's largest economy by €1 billion a month.
Lars Lokke Rasmussen, the Danish foreign affairs minister, said: 'We should prepare to be ready to use all the tools. If you want peace, you have to prepare for war. And I think that's where we are.'
Laurent Saint-Martin, the French trade minister, has called on the EU to go beyond conventional trade retaliation to unprecedented 'anti-coercion' measures targeting America's services and tech sectors. 'This balance of power desired by Donald Trump is a balance of power in which you must demonstrate your ability to fight back, and this is perhaps where we need to accelerate today,' he said.
European investors appeared to take the tariff threat seriously. Major indices across the bloc fell on Monday, led by sharp drops in the share prices of car manufacturers.
Germany's Dax index of the 40 biggest companies was down more than 200 points in mid-afternoon, at 24,053.43, compared with a record above 24,600 achieved last week. The fall was led by Volkswagen, Mercedes-Benz, Porsche and BMW.
In France, the CAC was also in the red, losing 40.37 points to 7,788.92.