The decision of the U.S. to impose tariffs on steel and aluminum exports has faced a backlash across the world. Many countries have expressed displeasure with the decision and decided to take various measures to retaliate. The reason behind the decision may be its competition in trade with China or a threat to national security, but the decision has impacted many countries across the world. The European Union (EU) is among those affected from the decision. Officials of EU have been trying to understand the reason behind the tariffs and whether it will affect its 28-member states. Cecilia Malmstrom, the European Commissioner for trade outlined that national security cannot be the reason behind the imposed tariffs. She added that the European Commission would take the case forward to the World Trade Organization (WTO) in Geneva and put pressure to reverse the decision by the U.S.

The Trump administration signed off a legislation that would impose tariffs of 25 percent on steel and 10 percent on aluminum. This decision will not only disturb financial markets for the short term but also leave lasting damages on the U.S.-Europe relations for long term. The administration has not provided any guidelines to its trading partners that would help them win an exemption. Donald Trump tweeted on Monday that his Commerce Secretary Wilbur Ross will meet EU commissioners soon. Commission officials said they do not have any idea about what he was talking about.

In her address to trade forum on Monday, Cecilia Malmstrom outlined that the Europe will “stand up to bullies” and will not be intimidated by threats. Moreover, she highlighted that there will not be any discussions to avail exemption. Such discussions will outline that Europe has given in to the blackmail. The commission has released a three-pronged strategy, which has been well-received by business leaders and politicians across the continent.

Dutch Finance Minister Wopke Hoekstra outlined that imposing tariffs on steel and aluminum was a bad idea, for not only citizens but also workers on both sides of the Atlantic. In addition, Germany’s new economy minister Peter Altmeier has been hoping for this decision to deescalate. He also outlined that the European response is entirely on paper at this phase. French economy and finance minister Bruno Le Maire said the EU should be united and join hands with countries outside Europe to retaliate against the U.S. Le Maire opined that there needs to be common response from member states of EU. Then, if other countries are willing join, they are open for discussion. He pushed “European forces to think about common concern, a common response, and to deliver a response if necessary.”

The U.S. President Donald Trump defended his decision, outlining that the tariffs will help in dealing with overcapacity in the steel industry. Moreover, it would prohibit China from “dumping” excess steel onto other countries.

This is not how the EU sees this move. EU views this decision as protectionist and a way to limit free trade. Moreover, this move may lead to a “trade war” with China and other countries. The European Steel Association highlighted that there would have been some damage to manufacturers in mainland Europe. Only time will tell how EU will deal with this situation.

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