“If we draw lessons from history, that is, from the way he conducted his first term, Trump is clearly a threat (to the EU). You only have to look at the tariff surcharges or their (lack of) commitment to NATO or the fight against climate change.” With few notable exceptions, these words from the president of the European Central Bank (ECB), Christine Lagarde, uttered in January of this year They reflect the general feeling of European leaders regarding the possible victory of the Republican candidate in the US elections on November 5.
Brussels has been preparing for months for all possible scenarios that emerge from these elections. After Trump encouraged Russia in February to do “whatever it wants” with NATO countries that do not “pay what they owe” in defense, the president of the Commission, Ursula von der Leyendecided to create a specific working group that was tasked with designing contingency plans. The result is a carrot and stick strategy, rewards and punishmentsto deal with the Republican candidate. An initiative that has been developed with the utmost secrecy and whose details are still unknown.
In his first term, Trump took community leaders by surprisewho took for granted that his arrival at the White House would moderate him. The first salvo of fire came with the tariffs on the black olives from Spainbut even then the EU bosses did not believe that the US was going to declare a total trade war against them. They were completely unarmed for conflict.
Trump thus had a completely clear front to strike first with surcharges to steel and aluminumand to later act against Community agricultural products, in this case as retaliation for public aid to the aircraft manufacturer Airbus. Nor did he hesitate label Europeans as “enemies”. The coming to power of Joe Biden It hardly represented a truce in this war, since many of the tariffs against the EU (starting with those affecting black olives) have not even been eliminated.
If he wins on November 5, Trump has promised in the campaign that he will impose a general surcharge of between 10% and 20% on all imports (including European ones), which in the case of China will rise to 60%. Tariffs that would reduce European exports by 150 billion a year. In a recent interview with Bloombergthe ultra candidate complained about a trade deficit that he places at 300,000 million dollars (a false figure, the real one is around 125,000 million in 2023). “The EU treats us so badly”says Trump.
But this time, the EU has prepared a complete arsenal to respond to any Trump decision “from minute one,” as European sources confirm to EL ESPAÑOL-Invertia. A list of small agreements that Brussels will offer Trump from the first moment, but also a list of American products to hit where it will do him the most damage if the Republican candidate does not listen to reason and continues with his tariffs. It’s about preparing for the best and the worst.
The example that European leaders use of a mini-agreement that can be offered to Trump is the ‘locust pact’. In August 2020, the then Trade Commissioner, the Irish Phil Hogan closed a deal with Trump’s envoy, Robert Lighthizer to eliminate tariffs on imports of live and frozen lobster products from the United States. In exchange, the United States cut its surcharges by 50% on a series of European products such as glassware and lighters.
The real impact of this agreement was negligible: purchases of North American lobsters in Europe barely amounted to 100 million euros, while imports of goods from the US to the EU amounted to 358.5 billion in 2022. But it did serve to lower the temperature of the trade war. “It was a low-level deal, but it showed that Trump is willing to negotiate if there is something that directly interests him, even if that goes against his rhetoric. Trump is a mercantilist, he only thinks in terms of what he can win or lose“, point out the sources consulted.
If the negotiation fails, the counterattack model that Brussels has prepared resembles the design of the tariff surcharges that the EU imposed on the US in retaliation for the aluminum and steel case. The community Executive then decided to hit Trump where it could hurt the most, punishing iconic products such as Harley-Davidson motorcycles or bourbon whiskey. Some items that are also manufactured in pivotal states where the power of the Republicans in the following elections was at stake.
These surcharges are suspended until March 2025 and will be reactivated if Washington does not lift its tariffs against European steel and aluminum. But the Commission has also prepared another list top secret of American products in order to do as much damage as possible to the republicanssince their voters would be the most affected.
The ultimate goal is for Trump to return to the negotiating table as soon as possible. After all, his authorized biography is titled The art of the deal.
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