Retaliation must be considered to Trump ‘blackmail’: Business leaders
Business groups told CNBC that the EU should consider retaliatory measures in response to U.S. President Donald Trump’s threats to impose tariffs on the bloc.
The EU has frozen the EU-US trade deal in response to Trump’s announcement on Saturday (February 1) that he planned to impose 10% tariffs on six EU countries, as well as the UK and Norway. There have been calls for the bloc to consider using its anti-coercion instrument (ACI), a set of measures that would allow it to impose comprehensive trade sanctions.
“All EU trade defense instruments, including the Anti-Coercion Instrument (ACI), now need to be reviewed,” Volker Treier, director of foreign trade at the German Chamber of Commerce and Industry (DIHK), which represents nearly 4 million businesses, told CNBC. he said. He added that ACI should be a “last resort”.
Ole Erik Almlid, CEO of the Confederation of Norwegian Enterprises, which represents thousands of businesses, told CNBC that Europe must be “ready to act decisively if our interests are put at risk” while continuing to work to de-escalate tensions.
“Europe must not allow itself to be blackmailed, even by the United States,” Bertram Kawlath, president of VDMA, the German industrial sector association that represents 3,500 engineering firms, said on Sunday. he said.
“Greenland is part of Europe and must remain so. If the EU capitulates here, it will only encourage the American president to make the next ridiculous demand and threaten more tariffs,” he said, adding that the European Commission should examine whether the ACI could be used.
Economic impact
Business leaders have warned that the impact on European businesses could be significant if tariffs are introduced on February 1, as Trump has previously threatened.
Analysis by the British Chambers of Commerce found that 10% tariffs on US exports could cost UK businesses £6bn, rising to £15bn or $20bn in June. On this date, Trump said that if countries continued to resist Greenland plans, customs duties would increase to 25%.
“The UK is not without influence, our bilateral trade with the US is worth £300bn, we have invested £500bn in its economy and it has £700bn linked to ours,” BCC Director General Shevaun Haviland said. “There is a high level of interdependence. The government must keep everything on the table during the talks.”
Deutsche Bank analysts said on Monday that European countries Its huge holdings in US assets give it an advantage as it weighs countermeasures.
But new tariffs from the United States would lead to “significant” disruptions to German companies’ trade and transatlantic business, Treier told CNBC.
The European mechanical and plant engineering industry is currently disproportionately affected by U.S. tariffs, as many products are subject to a 50% duty on steel and aluminum, Kawlath said.
“This is coupled with high bureaucratic costs that hinder many transactions,” he added. “More than half of exported machinery may be affected.”
