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On what he branded “Liberation day” (2 April 2025), President Trump made good on his threat to increase United States tariffs by 60% on imports from China and by between 10% and 20% on imports from other trading partners, including the European Union. He announced a two-tier additional tariff structure: 10% on all imports from all countries, except Canada and Mexico; and a country-specific ‘reciprocal tariff’ on most imports from countries that have large and persistent goods trade surpluses with the US. 

The uniform 10% baseline tariff went into effect on 5 April 2025. The higher country-specific reciprocal tariffs were supposed to begin on 9 April 2025. However, following turmoil in financial markets, President Trump announced on 8 April that reciprocal tariffs would be suspended for 90 days. China was excluded from the suspension measure on the grounds that it had already retaliated against its country-specific US tariff.  

According to the Trump Administration and its supporters, the 90-day pause is supposed to allow on how they plan to reduce their bilateral trade surpluses with the US. 

The question now is how the EU should react to the new reality its exporters face in the US market – a 10% tariff on most products and a 25% tariff on steel, aluminium and cars – and to the further threat that, after the 90-day pause, the 10% uniform tariff may become an EU-specific tariff of 20%.

While the EU debates the pros and cons of making a deal with the US in the next 90 days (surely a bad idea since it would mean capitulating to blackmail) and of retaliating against the new US tariffs that are already in place and/or the additional ones that may come in three months (an idea that deserves serious debate), it should make intense efforts to reinforce its cooperation with other countries.  

Beyond seeking to expand its network of bilateral and regional trade and cooperation agreements with countries in the Americas, Asia, Africa and, obviously, Europe, the EU should launch a multilateral initiative with as many likeminded countries from the Global North and the Global South as possible. 

EU leaders should engage with leaders of G20 and non-G20 countries to agree on a statement in London in April 2009 at the height of the global financial crisis. This statement should be drafted along the following lines:

We, the leaders of [X], reaffirm our commitment to open and rules-based trade embodied by the World Trade Organisation (WTO). World trade growth has underpinned rising global prosperity for nearly 80 years. To this effect, we recall the essential contribution by the United States to the creation of the General Agreement on Tariffs and Trade (GATT) in 1947, and its successor, the WTO, in 1995.

Today, the United States is rejecting the basic tenets of the world trading system by adopting unilateral protectionist measures that will harm not only our nations but the entire world, including the United States. We deeply regret this situation. 

We will not follow the protectionist path chosen by the United States. Instead, we will refrain from raising new barriers to trade and investment and respect WTO rules in our mutual relations.

Beyond this standstill commitment, we will instruct our trade ministers to launch negotiations to reform the rules of the WTO in three key areas: dispute settlement; subsidies; and climate, trade and development. They should find ways to make progress in all three areas, even if some WTO members who are not signatories to this statement refuse to cooperate.

Admittedly, the G20 has become a difficult forum in which to find agreement on such a statement because of the presence of the United States and Russia, two members that have recently flouted international norms and rules. Nonetheless it may serve as a basis for an agreement among its other 18 members (call it the G18) and all other nations that remain attached to an open, rules-based, multilateral trading order.