Brussels signals readiness for deal but warns retaliation can be triggered “at the drop of a hat”
The European Union has paused its retaliatory tariffs on US goods ahead of a looming deadline, as trade officials await a formal letter from US President Donald Trump that could impose new duties on EU exports. With tensions rising after Washington slapped a 35% tariff on Canadian imports, the bloc is bracing for its own escalation—but insists the “ball is in Washington’s court.”
Speaking at a midday briefing Friday, European Commission trade spokesperson Olof Gill said the EU was still pursuing “an agreement in principle with the US” and was prepared to act swiftly if necessary. “We await some indication from our American counterparts that they are ready to do the same,” he said. “If we need to unsuspend [our countermeasures], we can do that, you know, at the drop of a hat.”
Suspension of EU countermeasures hangs in the balance
The EU had originally planned to activate €21.5 billion worth of retaliatory tariffs in response to US steel and aluminium duties—but suspended the measures earlier this year after the White House agreed to a 90-day pause in implementation. That suspension expires just after midnight on Tuesday, July 15, meaning Brussels must now decide whether to extend it or let it lapse and trigger immediate retaliation.
The Commission can act unilaterally under an “urgency procedure,” requiring only subsequent approval from member states. Trade ministers from the EU’s 27 countries are set to meet in Brussels on Monday to assess the situation and determine whether to move forward with countermeasures.
“We are ready to conclude a deal,” Gill reiterated. “But we’ve had no indication this will happen imminently.”
Trump threatens new round of tariffs
President Trump, who has already levied 10% blanket tariffs and specific duties of 50% on EU steel, 25% on cars, and 10% on most other EU goods, told NBC on Thursday that letters were being prepared for other partners, including the European Union. “We’re just going to say all the remaining countries are going to pay,” Trump said, citing rates of 15% or 20% under consideration.
The comment came hours before Canada received its own letter, confirming a 35% tariff starting August 1—a sharp increase from the earlier 25% level. The move has ratcheted up pressure on all of Washington’s trading partners to finalise deals under Trump’s aggressive tariff regime.
Though the EU had hoped to secure a comprehensive agreement with the US covering industrial goods, negotiations have narrowed in scope in recent weeks. Talks have focused on anchoring a 10% baseline tariff and finding specific relief for hard-hit sectors such as automobiles, aircraft, and spirits.
A senior EU official said the situation remained fluid: “There might be an agreement by Monday, just as there might not be. There will be many uncertainties, twists and turns in the weeks and months ahead.”
Steel sector sounds the alarm
European steelmakers, already reeling from US tariffs, have warned that further delays or inaction could be catastrophic. Eurofer, the European Steel Association, accused the EU of lagging behind the US in defending its own industry.
President Henrik Adam said that “the US duties on steel at 50%” are “fueling an already explosive situation,” diverting trade flows into the EU and threatening to wipe out the bloc’s export position. “We’ve already lost 10 million tonnes of steel capacity in 2024,” he said, citing massive overcapacity and an EU response that remains “insufficient.”
While the US has pursued an aggressive industrial strategy—combining tariffs, green subsidies, and “Buy American” rules—Eurofer argued that the EU’s Steel and Metals Action Plan has delivered little relief. Adam warned that without bold action, the bloc’s industrial backbone could be permanently weakened.
A fragile path forward
EU Commission President Ursula von der Leyen has said the bloc wants to “give negotiations a chance,” and Trade Commissioner Maroš Šefčovič has been in active discussions with US officials. However, with no further meetings scheduled over the weekend, officials admit time is running out.
If no deal is struck and a letter from Trump arrives, the EU could move swiftly to impose retaliatory tariffs—initially covering €21.5 billion in goods, with a second list of countermeasures on €72 billion in imports also prepared.
