Facing Trump's threat of a 50% tariff, European officials call for a "calm" response.

After President Trump threatened to impose a 50% tariff on imported goods from the European Union, European officials attempted to show a unified and calm stance. The market is worried that a trade war will disrupt the largest commercial and investment relationship globally, and this potential escalation in trade measures has triggered a sharp decline in stock markets on both sides of the Atlantic. On Friday, Trump criticized the EU as "difficult to deal with" on social media, stating that negotiations between the two sides have "made no progress" and proposed an additional 30% tariff on top of the existing 20% tariff (currently reduced to 10% until July 9 due to a 90-day suspension period). This move is reminiscent of his strategy last month against China, where he imposed a 145% tariff on imported goods. However, as financial markets plummeted, Trump made concessions and announced on May 12 that he would reduce peak tariffs and extend the negotiation period for another 90 days. Scott Bessent, the US Treasury Secretary, said, "I hope this will prompt action from the EU." In response, European officials tried to demonstrate restraint and a determination to continue negotiations, with several officials describing the attitude needed when economic relations with their largest trading partner become strained as "calm." "Calm Assessment" Dutch Prime Minister Dick Schoof said on Friday, "This is all part of negotiations. We will calmly assess the proposals and respond in a firm and forceful manner. Part of the challenge facing Europe is the uncertainty about the specific demands of the US. ING economists Inga Fechner, Carsten Brzeski, and Chris Turner wrote in a research report on Friday, "Apart from the previously considered unilateral reduction of tariffs by the EU, the actual agreement that the US government expects remains unclear." Elisabeth Svantesson, the Swedish Minister of Finance, called Trump's latest threat a "potentially damaging and unreasonable escalation of the US-EU economy," adding, "We need more free trade, not less." Germany's new Minister of Economic Affairs and Trade, Katherina Reiche, warned that if rhetoric turns into policy, both sides will face dire consequences. Reiche stated, "There are no winners in a tariff dispute. We must make every effort to ensure that the European Commission and the US reach a negotiated solution. These high tariffs will harm both the US and the EU equally." Ireland's Deputy Prime Minister Simon Harris said that negotiations remain a priority for the EU and Ireland. "We need to engage in substantive, calm, cautious, and comprehensive dialogue with the United States," Harris said, "Our deep and enduring relationship with the United States deserves more sustained and substantive dialogue in the future to reach a negotiated solution." French Minister of Trade Laurent Saint-Martin stated on the social platform X, "We maintain our usual position: to ease tensions, but we are also prepared to respond." Simone Tagliapietra, a senior researcher at the Bruegel Institute in Brussels, said that Trump's statement "put a damper on Brussels - but there is still hope that this is just another negotiating strategy aimed at increasing pressure for negotiations." Brad Setser, a former US Treasury official now serving on the Council on Foreign Relations, stated that if Trump follows through on his threats, the EU may take retaliatory measures. "Trump may put the EU in a situation where the European Commission and major member states will feel that they need to escalate to de-escalate," he wrote on X, "Unless Trump can be convinced to step back and wait for new proposals from the EU in the next ten days, the EU may initiate retaliatory procedures." The EU is prepared to impose tariffs on 21 billion worth of US goods in response to Trump's metal tariffs - but the implementation date has been pushed back to mid-July. If negotiations fail, the implementation date may be moved up. The EU is also preparing another list of 95 billion worth of US products to impose tariffs on in case negotiations with Washington fail. These measures will target industrial products including Boeing aircraft, American-made cars, and bourbon whiskey.