MEZIESBLOG

The European Union owes its origins to a trade agreement that involved coal and steel. 

At its very heart is a belief that free trade between partners is a fundamentally good thing. Nothing is more certain to upset policymakers in Brussels than the spectre of swingeing tariffs.

They saw this coming, of course. Leaders in both Paris and Berlin already made it clear that the EU was ready to respond, while bemoaning the whole thing.

Talk to diplomats across Europe and almost all will tell you the same thing – that nobody wins from a trade war.

But beyond the anger and diplomatic fret, there is something else that could happen now, and strain relations with Washington even more.

European leaders, with a few exceptions, are nowhere as near to adopting the same protectionist viewpoint as Trump.

That means that, if they think American markets are being closed off to them, then they will look for new places to sell goods.

And that is likely to lead in three directions.

Unlikely partnerships

First, China, which has always been seen as a less palatable and less reliable partner than America. Now that judgement is likely to be revised. 

Second, they will look at India, where a comprehensive trade agreement remains outstanding, despite growing bilateral trade.

And, third, the EU will look at South America, another growing market.

And that wouldn’t just affect trade. 

If Europe develops closer economic relations with China, India, Brazil and others, then that’s bound to affect a welter of other geopolitical deals – exactly the sort of things that annoy and worry American presidents.

The consequence of American tariffs could see European nations forging new, and even unlikely, partnerships, just as the old transatlantic friendship comes under strain.

Europe hits out at Trump’s ‘unlawful’ tariffs

The European Commission has vowed it will respond to Donald Trump’s 25% tariffs on steel and aluminium, calling them “unlawful and economically counterproductive”.

“The EU sees no justification for the imposition of tariffs on its exports. We will react to protect the interests of European businesses, workers and consumers from unjustified measures,” a statement from the Commission says.

Meanwhile, French industry minister Marc Ferracci has said Europe’s response must be “firm and united”.

France is not a major producer of aluminium or steel, but Ferracci said it could be indirectly affected by the tariffs if Chinese imports stymied by American tariffs made their way to European shores.

“We should expect that there will be some effects from Donald Trump’s tariffs. Europe must respond in a united manner, because we know that Donald Trump’s strategy is to divide Europeans,” Ferracci told TF1 TV. 

“We must stay united, we must respond in a firm manner. Europe is capable of doing this.”