Trade War Escalates: EU and Canada Respond to U.S. Tariffs

The European Union and Canada have initiated retaliatory tariffs against the U.S. due to newly imposed levies on steel and aluminum imports, contributing to an escalating global trade dispute.

The ongoing trade conflict intensified yesterday as the European Union (E.U.) and Canada declared billions of dollars in retaliatory tariffs on U.S. exports, in direct response to President Trump’s recent imposition of tariffs on steel and aluminum imports.

The E.U. announced that its tariffs would be enacted on April 1, effectively countering approximately $26 billion worth of tariffs instituted by the U.S. E.U. officials, however, indicated a willingness to negotiate a resolution. Their response will unfold in two stages: first, allowing a tariff suspension initiated under President Biden to expire, subsequently raising tariffs on a wide array of products, including luxury items such as boats, bourbon, and motorcycles. The second phase will introduce tariffs targeting an additional 18 billion euros in goods, the specifics of which are yet to be disclosed.

Meanwhile, Canada has committed to applying new tariffs on $20 billion worth of U.S. products. This tariff round focuses primarily on steel and aluminum but also extends to a diverse range of imports including tools, computers, sporting goods, and cast iron.

In contrast to the retaliatory actions of the EU and Canada, Britain has opted not to impose retaliatory tariffs, with Prime Minister Keir Starmer pursuing the potential of a long-term trade agreement with the U.S. Similarly, Australia’s Prime Minister Anthony Albanese has stated that his country will forgo reciprocal tariffs, citing concerns about the impact on domestic consumers.