The European Union flips from retaliation threats to offering ‘zero-for-zero’ tariffs with the U.S.

European Union member states are expected to vote today on whether to approve tariffs on about 21 billion euros worth of U.S. goods. The bloc will decide on a return for the 25% tariffs on European steel and aluminum Trump imposed last month.

Sweden’s trade minister, Benjamin Dousa, said that Brussels will also decide whether to get rid of its first retaliatory shot against U.S. President Donald Trump’s tariffs. He also noted that a qualified majority of member states would block the retaliation, which would take effect in three tranches in April, May, and December.

Dousa believes the EU favors free trade

EU flips from retaliation threats to offering 'zero-for-zero' tariffs with the US. Trump’s tariff pressure seems to be paying off-talks are back on the table. pic.twitter.com/QODuJWq2c4

— 𝐃𝐔𝐓𝐂𝐇 (@pr0ud_americans) April 7, 2025

Dousa maintained that the European Union favored free trade, including the commission’s proposal to the U.S. to mutually eliminate all tariffs on industrial goods. He said, “The U.S. is one of our closest friends in the world. We want more trade.”

The politician argued that humankind has made the biggest leaps forward when goods, services, talents, entrepreneurs, and ideas move freely over the Atlantic. He also believes that a collaboration between Europe and the U.S. will allow new pharmaceuticals, more powerful robots, and exciting software.

Dousa also highlighted the bloc’s assessment that the U.S. was not yet willing to negotiate about dropping its 25% tariffs on steel, aluminum, and cars, plus 20% on everything else.

The minister also mentioned, “If we are forced to go forward with countermeasures, member states will support it.” The Bloc’s commissioner, Maros Sefcovic, revealed he will send his plans to retaliate against Trump’s so-called “reciprocal” tariffs early next week.

EU considers using the ACI for the first time against Trump’s levies

EU Loads the Bazooka: Trump’s Tariff Tantrums Won’t Work This Time🇪🇺

The EU is building a legal and economic “anti-Trump shield”, and this time, they’re not fucking around. They’ve learned from 2018–2020, when Trump’s trade war hit Europe almost as hard as China. And now?… pic.twitter.com/T0o7k8CTkI

— Mario 🇺🇸🇵🇱🇺🇦🇪🇺 (@PawlowskiMario) April 8, 2025

Douglas also believes that countermeasures will be a lot longer if current tariff trends continue. He also argued whether the European Union should use its so-called Anti-Coercion Instrument (ACI) for the first time. ACI would allow the European Union to hit U.S tech firms from winning public procurement contracts.

“When considering using ACI, we should be cautious. It is a broad instrument, and it has never been used before, so we have to analyze it carefully. But in principle, all options are on the table.”

-Benjamin Dousa, Sweden’s trade minister.

He also warned that if the European Union does not think it through and goes too fast, it could hurt the bloc more than it hurts the U.S. economy.

A response from all the bloc’s trade ministers at their meeting in Luxembourg on Monday revealed that the European Union was negotiating with the ACI in its hands but still can’t agree on whether to pull the trigger just yet.

The EU’s president, Ursula von der Leyen, maintained that the block first wanted to negotiate. She also added that the EU was offering a “zero-for-zero” tariffs scheme on industrial goods, covering cars, drugs, chemicals, plastics, and machinery, among other things.

The ACI is a nuclear option that has yet to be deployed and would empower Leyen to hit U.S. service industries such as tech and banking. Leyen noted that Trump’s tariffs, which would affect 380 billion euros worth of EU exports, are the economic scenarios the EU had in mind when designing the ACI.

Douglas said that just because Trump’s’ reciprocal tariffs of 20% on all European Union goods doesn’t mean the Block was ready to activate the ACI. He argued that doing so would mean the 27-nation bloc was really in a trade war.

Spain’s economy minister, Carlos Cuerpo, said that the Anti-Coersion Instrument was there for them to use in case they find it necessary. He added that “we need to explore the use of all the instruments that are at our disposal. That’s for sure. We should not rule out anything.”

The commission is also considering slapping tariffs of up to 25% on a broad range of exports from the U.S. in response to Trump’s levies on steel and aluminum. The bloc will vote on the plan on Wednesday.

The vote would see the commission impose a 25% duty on a wide range of U.S. exports. Eurostat data showed that the total amount of U.S. exports affected would be 22.1B euros based on the EU’s 2024 imports.

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