Tensions are rising as the EU considers tougher trade retaliation against the U.S., following a breakdown in negotiations and looming tariffs.
The European Union is preparing stronger countermeasures against the U.S. after trade talks faltered and President Trump threatened a 30% tariff on EU exports by 1 August.
EU diplomats say support is growing, especially from Germany for activating a broad 'anti-coercion' tool that could target U.S. services, public tenders, and investments.
EU Trade Commissioner Maros Sefcovic warned such tariffs would 'practically prohibit' trade, while diplomats say Washington failed to offer consistent solutions.
Though the EU still prefers a negotiated deal, the option to impose retaliatory tariffs on €72 billion worth of U.S. goods is under active consideration.
European Commission President Ursula von der Leyen said the anti-coercion measure was designed for 'extraordinary situations'—and now, the bloc may be nearing that point.
Washington has also rejected the EU's demand for a 'standstill' arrangement, whereby no further tariffs would be imposed after a deal is struck.
The rationale, according to diplomats, is that Trump's hands cannot be tied on national security, the basis of Section 232 trade investigations into pharmaceuticals, semiconductors and timber.
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