Politics
US tariffs on European goods threaten to shake up the world’s largest trade relationship – National TenX News
The European Union expects to find out on Monday whether President Donald Trump will impose punishing tariffs on America’s largest trade partner in a move economists have warned would have repercussions for companies and consumers on both sides of the Atlantic.
Trump imposed a 20 per cent import tax on all EU-made products in early April as part of a set of tariffs targeting countries with which the United States has a trade imbalance. Hours after the nation-specific duties took effect, he put them on hold until July 9 at a standard rate of 10 per cent to quiet financial markets and allow time for negotiations.
Expressing displeasure with the EU’s stance in trade talks, however, Trump said he would increase the tariff rate for European exports to 50 per cent, which could make everything — from French cheese and Italian leather goods to German electronics and Spanish pharmaceuticals — much more expensive in the U.S.
The EU’s executive commission, which handles trade issues for the bloc’s 27-member nations, said its leaders hope to strike a deal with the Trump administration. Without one, the EU said it was prepared to retaliate with tariffs on hundreds of American products, ranging from beef and auto parts to beer and Boeing airplanes.
U.S. Treasury Secretary Scott Bessent told CNN’s “State of the Union” program on Sunday that “the EU was very slow in coming to the table” but that talks were now making “very good progress.”
Here are important things to know about trade between the United States and the European Union.
US-EU trade is enormous
The European Commission describes the trade between the U.S. and the EU as “the most important commercial relationship in the world.”
The value of EU-U.S. trade in goods and services amounted to 1.7 trillion euros (US$2 trillion) in 2024, or an average of 4.6 billion euros a day, according to EU statistics agency Eurostat.
The biggest U.S. export to Europe was crude oil, followed by pharmaceuticals, aircraft, automobiles, and medical and diagnostic equipment.
Europe’s biggest exports to the U.S. were pharmaceuticals, cars, aircraft, chemicals, medical instruments, and wine and spirits.
EU sells more to the US than vice versa
Trump has complained about the EU’s 198 billion-euro trade surplus in goods, which shows Americans buy more stuff from European businesses than the other way around.
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However, American companies fill some of the gap by outselling the EU when it comes to services such as cloud computing, travel bookings, and legal and financial services.
The U.S. services surplus took the nation’s trade deficit with the EU down to 50 billion euros (US$59 billion), which represents less than three per cent of overall U.S.-EU trade.
What are the issues dividing the two sides?
Before Trump returned to office, the U.S. and the EU maintained a generally cooperative trade relationship and low tariff levels on both sides. The U.S. rate averaged 1.47 per cent for European goods, while the EU’s averaged 1.35 per cent for American products.
But the White House has taken a much less friendly posture toward the longstanding U.S. ally since February. Along with the fluctuating tariff rate on European goods Trump has floated, the EU has been subject to his administration’s 50 per cent tariff on steel and aluminum, and a 25 per cent tax on imported automobiles and parts.
Trump administration officials have raised a slew of issues they want to see addressed, including agricultural barriers such as EU health regulations that include bans on chlorine-washed chicken and hormone-treated beef.
Trump has also criticized Europe’s value-added taxes, which EU countries levy at the point of sale this year at rates of 17 per cent to 27 per cent. But many economists see VAT as trade-neutral since they apply to domestic goods and services as well as imported ones. Because national governments set the taxes through legislation, the EU has said they aren’t on the table during trade negotiations.
“On the thorny issues of regulations, consumer standards and taxes, the EU and its member states cannot give much ground,” Holger Schmieding, chief economist at Germany’s Berenberg bank, said. “They cannot change the way they run the EU’s vast internal market according to U.S. demands, which are often rooted in a faulty understanding of how the EU works.”
‘Consequence for many companies’
Economists and companies say higher tariffs will mean higher prices for U.S. consumers on imported goods. Importers must decide how much of the extra tax costs to absorb through lower profits and how much to pass on to customers.
Mercedes-Benz dealers in the U.S. have said they are holding the line on 2025 model year prices “until further notice.” The German automaker has a partial tariff shield because it makes 35 per cent of the Mercedes-Benz vehicles sold in the U.S. in Tuscaloosa, Alabama, but the company said it expects prices to undergo “significant increases” in coming years.
Simon Hunt, CEO of Italian wine and spirits producer Campari Group, told investment analysts that prices could increase for some products or stay the same depending what rival companies do. If competitors raise prices, the company might decide to hold its prices on Skyy vodka or Aperol aperitif to gain market share, Hunt said.
Trump has argued that making it more difficult for foreign companies to sell in the U.S. is a way to stimulate a revival of American manufacturing. Many companies have dismissed the idea or said it would take years to yield positive economic benefits. However, some corporations have proved willing to shift some production stateside.
France-based luxury group LVMH, whose brands include Tiffany & Co., Luis Vuitton, Christian Dior and Moet & Chandon, could move some production to the United States, billionaire CEO Bernaud Arnault said at the company’s annual meeting in April.
Arnault, who attended Trump’s inauguration, has urged Europe to reach a deal based on reciprocal concessions.
“If we end up with high tariffs, … we will be forced to increase our U.S.-based production to avoid tariffs,” Arnault said. “And if Europe fails to negotiate intelligently, that will be the consequence for many companies. … It will be the fault of Brussels, if it comes to that.”
‘Road could be rocky’
Some forecasts indicate the U.S. economy would be more at risk if the negotiations fail.
Without a deal, the EU would lose 0.3 per cent of its gross domestic product and U.S. GDP would fall 0.7 per cent, if Trump slaps imported goods from Europe with tariffs of 10 per cent to 25 per cent, according to a research review by Bruegel, a think tank in Brussels.
Given the complexity of some of the issues, the two sides may arrive only at a framework deal before Wednesday’s deadline. That would likely leave a 10 per cent base tariff, as well as the auto, steel and aluminum tariffs in place until details of a formal trade agreement are ironed out.
The most likely outcome of the trade talks is that “the U.S. will agree to deals in which it takes back its worst threats of ‘retaliatory’ tariffs well beyond 10 per cent,” Schmieding said. “However, the road to get there could be rocky.”
The U.S. offering exemptions for some goods might smooth the path to a deal. The EU could offer to ease some regulations that the White House views as trade barriers.
“While Trump might be able to sell such an outcome as a ‘win’ for him, the ultimate victims of his protectionism would, of course, be mostly the U.S. consumers,” Schmieding said.
World leaders are raising alarm after U.S. President Donald Trump threatened to impose sweeping tariffs on European allies in an effort to pressure Denmark into negotiations over Greenland.
The move is sparking protests across the Arctic and sharp rebukes from Europe and Canada.
On Saturday, thousands of people marched through snow and ice in Greenland’s capital, Nuuk, chanting “Greenland is not for sale,” waving national flags.
Police described the demonstration as the largest they have ever seen in the city.
About 825 kilometres away, dozens of people rallied in Iqaluit, Nunavut, in a show of solidarity with Greenlanders.
“Greenland is owned by the Greenlandic people,” protesters chanted in Inuktut as they marched for an hour in freezing, windy conditions.
The protests came as Trump announced he would impose a 10 per cent import tax starting next month on goods from eight European countries.
These nations include Denmark, Norway, Sweden, France, Germany, the United Kingdom, the Netherlands and Finland, because of their opposition to U.S. control of Greenland.
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The tariff would rise to 25 per cent on June 1 if no deal was reached for what Trump called the “Complete and Total purchase of Greenland.”
The president suggested the tariffs were leveraged to force talks over Greenland, a semi-autonomous territory of NATO ally Denmark that Trump says is vital to U.S. national security.
French President Emmanuel Macron said France stands firmly behind Greenland’s sovereignty and rejected the use of trade threats.
“Tariff threats are unacceptable and have no place in this context,” Macron wrote on social media, adding that Europeans would respond “in a united and coordinated manner” if the measures are confirmed.
British Prime Minister Keir Starmer said Greenland’s future is for Greenlanders and Denmark to decide.
“Applying tariffs on allies for pursuing the collective security of NATO allies is completely wrong,” Starmer said, adding the issue would be raised directly with the U.S. administration.
Bob Rae, former Canadian ambassador to the United Nations, also chimed in on Trump’s announcement.
The tariff threat could mark a significant rupture between the U.S. and its NATO allies.
Greenland already hosts the U.S.-run Pituffik Space Base under a 1951 defence agreement with Denmark, supporting missile warning, missile defence and space surveillance for the U.S. and NATO.
“There is no sign of the Trump war of aggression against Greenland and Denmark letting up. It is not about ‘security’ any more than Venezuela was about ‘narco-terrorism.’ They are both about seizing control and plunder.”
He further added, “No country, including my own, Canada, is safe or secure.”
The tariff threat could mark a significant rupture between the U.S. and its NATO allies.
Trump is expected to face questions about the proposed tariffs and Greenland later this week.
He is scheduled to attend the World Economic Forum in Davos, alongside several European leaders he has threatened with tariffs.
— With files from The Canadian Press
© 2026 Global News, a division of Corus Entertainment Inc.
Prime Minister Mark Carney arrived in Doha on Saturday as part of a push to attract foreign investment and deepen Canada’s economic partnerships beyond its traditional allies.
Carney’s visit comes on the heels of his visit to China and follows the recent presentation of a new federal investment budget aimed at positioning Canada as a stable, attractive destination for global capital.
In a news conference on Saturday, Finance Minister François-Philippe Champagne said Canada is working to broaden its economic relationships as global trade patterns shift.
Qatar is viewed by Ottawa as a strategic partner, with officials pointing to the country’s significant investment capacity and growing influence on the global stage.
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“We need to reduce our dependence and increase our self-reliance to find a strategic path forward,” Champagne said.
“Engaging with the Middle East and China is necessary for Canada, just like our European partners have done,” Champagne added. “We buy more from the U.S.A. than anywhere else, but the trading climate right now is different.”
The conference highlighted Canada’s industrial capacity and trade advantages as key selling points for potential investors.
Champagne also said international engagement is critical as Canada works to raise its profile among global investors.
“We are one of the G7s with very big industries. We build cars, planes, ships, we have an abundance of energy, and we are the only one with free trade with all G7,” Champagne said. “With the way the world is changing, you better diversify, supply chain is changing and we need to adapt.”
Prime Minister Carney is expected to meet with senior Qatari officials, including Emir Sheikh Tamim bin Hamad Al Thani, as well as representatives of the Qatar Investment Authority.
His office says the talks will focus on expanding trade access and forging partnerships in artificial intelligence, infrastructure, energy and defence.
The visit comes amid heightened geopolitical tensions in the region, though officials say the schedule remains unchanged.
© 2026 Global News, a division of Corus Entertainment Inc.
The possibility of a forceful U.S. takeover of Greenland is raising many unprecedented questions — including how Canada, the European Union and NATO could respond or even retaliate against an ostensible ally.
A high-level meeting between Greenlandic, Danish and U.S. officials this week did not resolve the “fundamental disagreement” over the territory’s sovereignty but did set the stage for more talks. The White House made clear Thursday that U.S. President Donald Trump’s desire to control Greenland has not changed after the meeting.
“He wants the United States to acquire Greenland. He thinks it’s in our best national security to do that,” White House press secretary Karoline Leavitt said.
Denmark and European allies are sending more troops to the territory in a show of force and to display a commitment to Arctic security.
Experts say there are other, non-military measures available in the event of a U.S. annexation or invasion of Greenland, or which could at least be threatened to try and get Trump to back down.
Whether those economic measures are actually used is another matter, those experts say.
“I think it remains highly unlikely that we’ll get to that point where we have to seriously discuss consequences for a U.S. move on Greenland,” said Otto Svendsen, an associate fellow with the Europe, Russia, and Eurasia Program at the Center for Strategic and International Studies.
“So it remains contingency planning for a highly unlikely event. That being said … Denmark would certainly do everything in its power to rally a very robust European response.”
Here’s what that could entail.
EU trade, tech disruptions?
Experts agree the biggest pressure points that can be used in the U.S. surround trade and technology.
The European Parliament’s trade committee is currently debating whether to postpone implementing the trade deal signed between Trump and the EU last summer to protest the threats against Greenland, Reuters reported Wednesday.
Many lawmakers have complained that the deal is lopsided, with the EU required to cut most import duties while the U.S. sticks to a broad 15 per cent tariff for European goods.
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An even bolder move would be triggering the EU’s anti-coercion instrument — known as the “trade bazooka” — that would allow the bloc to hit non-member nations with tariffs, trade restrictions, foreign investment bans, and other penalties if that country is found to be using coercive economic measures.
Although the regulation defines coercion as “measures affecting trade and investment,” Svendsen said it could feasibly be used in a diplomatic or territorial dispute as well.
“EU lawyers have proven themselves to be very creative in recent years,” he said.
However, David Perry, president of the Canadian Global Affairs Institute, said in an email that economic measures against the U.S. are unlikely “given the massive asymmetry in the defence and economic relationship between the U.S.” and other western nations.
“Any kind of sanction against the U.S. doesn’t make sense for the same reason they can impose tariffs on others: they have the power,” Perry added.
Target U.S. tech companies?
The likeliest — and potentially least harmful — scenario for retaliation in the event of an attack on Greenland, Svendsen said, would be fines or bans against U.S. tech companies like Google, Meta and X operating in Europe.
That’s because the Trump administration has taken particular focus on preventing what they call “attacks” on American companies by foreign governments seeking to regulate their online content or tax their revenues, which has led to calls on Canada, Britain and the EU to repeal laws like digital services taxes.
“I think that would be a really smart and targeted way to get to economic interests very close to the president, while minimizing the direct impact on the on the European economy,” Svendsen said, calling such a move “low-hanging fruit.”
He also compared a future U.S. tech platform ban to how Europe moved to wean itself off Russian gas after the full-scale invasion of Ukraine in 2022.
“If you told anyone back then that Europe would basically rid itself of its dependence on Russian gas basically within a two-year period … that would have been considered completely impossible,” he said.
“Weaning the European economy off of U.S. tech would certainly be painful in the short term, but they’ve proven that they can get off those dependencies quickly if there is political will behind it in the past.”
A U.S. hostile takeover of Greenland would mean the “end” of the NATO alliance, experts and European leaders have said.
Trump himself has acknowledged it could be a “choice” between preserving the alliance or acquiring Greenland.
There is no provision within the NATO founding treaty that addresses the possibility of a NATO member taking territory from another, and how the alliance should respond to such an act.
A NATO spokesperson told Global News it wouldn’t “speculate on hypothetical scenarios” when asked how it could potentially act.
“None of this would be actionable in a NATO sense,” Perry said. “It’s an alliance that’s organized to bind the U.S. to European security, and revolves around the U.S. So there’s no scenario of NATO doing that to the U.S.”
Denmark and other European nations could move to reduce or close U.S. military bases in their countries as a possible response, experts say.
Balkan Devlen, a a senior fellow at the Macdonald-Laurier Institute and director of its Transatlantic Program, said in an interview that a U.S. annexation of Greenland would force Canada to focus entirely on boosting its defences in the Arctic.
That may include trying to decouple from NORAD, the joint northern defence network with the U.S., in favour of a purely domestic Arctic command, he said — although that process would take years and require Canada to increase defence spending even further.
“Never mind five per cent (of GDP) — we will probably need to go like seven, eight, nine per cent on defence spending to be able to do anything of that sort,” he said. “It’s not even clear that we’ll be able to have enough people to do that.”
Devlen added that any retaliatory action, whether military or financial, needs to be targeted and proportionate to what the U.S. does.
“The problem with nuclear options is that once you use it, it’s gone,” he said. “And if it doesn’t do the damage or make the change of behaviour on the other party, you’ve basically lost a lot of leverage and you might actually sustain a lot more loss yourself.”
“Unacceptable’: Allies react to Trump Greenland tariff threats – National TenX News
Canada talks trade with Qatar as Carney touches down in Doha – National TenX News
How could Canada, EU, NATO respond to a U.S. takeover of Greenland? – National TenX News
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