The EU must not waver in its response to the imposition this week of blanket US tariffs of 20% and should inflict as much damage as possible on the US, a former head of the European Commission’s trade department has told Euronews. “We need to take retaliatory measures that are proportionate to the damage caused by the US and inflict the maximum possible economic and political damage on the US,” said Jean-Luc Demarty, director-general of the Commission’s DG Trade between 2011 and 2019. “If we inflict economic damage on the US, it will lead to political damage. US voters base mainly their vote on the economical situation of their country,” he said.
Additionally, according to former EU senior official, the EU must hit the US with equivalent tariffs on US goods, avoiding those the EU needs. “We need to take action by first applying equivalent tariffs on a number of products that the Americans export to us, but of course by minimising the damage to us, which means by choosing products that are not essential and that can be found elsewhere,” Demarty said, adding: “The EU should not target US products, such as US shale gas, soy, a number of US technological products, or for instance US semiconductors.”
He also believes that the EU will need to deploy its anti-coercion tool adopted in 2023, which allows the bloc to restrict access public procurement, and to deprive companies of rights such as IP licence. “There is clearly coercion. Trump is denying us the ability to apply tariffs which, in some cases, are higher than US tariffs and in some cases lower. However, our tariffs are legal and comply with WTO rules,” he claimed, adding that Trump’s treatment of VAT and a number of EU regulations as effective ‘tariffs’ is also tantamount to coercion. Demarty said US big tech and Wall Street firms carry significant political influence. “In the United States, political parties are privately funded with huge sums. So this can have a political influence.” He also pointed out that the US administration with which the EU must now negotiate has become more radical, making the EU’s task more difficult. “In 2018, there were still people around Trump who were in favour of a certain openness to trade. Today, there are only half-crazy people around him who are in favour of closing markets,” Demarty said, adding: “The EU needs to hit it hard and not lie down.”
The former EU senior official concluded that US big tech and Wall Street firms carry significant political influence. “In the United States, political parties are privately funded with huge sums. So this can have a political influence,” he added. “In the EU, we should hit not just digital services and also financial services to damage essential American interests, both economic and political.” Demarty said this is a crucial part of the EU-US trade strategy. They will respond complementarily to the EU’s beneficial policy of delivering free movement of goods and services.
By imposing equivalent tariffs while avoiding excessively damaging US goods, the EU will show strong credibility. It will not be easy for the US to deny its interests after the EU’s trade policy is formalized. Specific cases that incur less damage will suffice. “The EU’s attack against the US, starting with this round, would be a win,” he said. The EU’s approach would appeal to big businesses, causing increasedбuying power in the market. In doing so, it would also create more euros, accelerating economic growth. “The manner in which the EU assesses the situation is crucial. For instance, if we push back the eight US有趣产品군 and demand the EU to push back eight EU imports,” the former expert said.
