But that could come to an end in the medium term, or at least suffer a significant decline, if Donald Trump fulfills his threat to impose a 200% tariff on wine, champagne, and European liquors. This new battle in the trade war initiated by the President of the United States would be a response to the European Union’s idea of imposing a tax on American whiskey.
The European tariff, revealed in response to the import taxes on steel and aluminum imposed by the Trump administration, was scheduled to come into effect on April 1st.
What did Trump say in response to the European Union?
Trump, in a morning post on social media, promised a new escalation in his trade war if the EU moves forward with the imposition of a 50% tariff on American whiskey.
“If this tariff is not removed immediately, the United States will soon impose a 200% tariff on all wines, champagnes, and alcoholic products leaving France and other countries represented by the EU,” wrote Trump. “This will be excellent for the wine and champagne business in the United States,” Trump added.
The Republican president stated on Wednesday that he intended to take said action. “Of course I will respond,” Trump said to journalists in a conversation in the Oval Office.
On Wednesday, when announcing the new tariffs on steel and aluminum, Trump openly challenged the allies of the United States and promised to recover the wealth “stolen” by other countries, which prompted a swift retaliation.
The president has imposed separate tariffs on Canada, Mexico, and China, with plans to also tax imports from the European Union, Brazil, and South Korea by applying “reciprocal” rates starting on April 2.
The bourbon manufacturers in the United States urged Trump to back down in his trade war.
“The liquor sector of the United States and the European Union is a model of fair and reciprocal trade, without tariffs since 1997,” said Chris Swonger, President and CEO of the Distilled Spirits Council. “We urge President Trump to reach a liquor agreement with the EU to restore zero tariffs, which will create jobs in the United States and increase manufacturing and exports in the American hospitality sector. We want to toast, not tariffs.”
What was the European Union’s reaction to Trump’s trade war?
The EU announced its own countermeasures. The President of the European Commission, Ursula von der Leyen, stated that, since the United States “imposed tariffs worth 28 billion dollars, we respond with countermeasures worth 26 billion euros,” or around 28 billion dollars.
These measures cover not only steel and aluminum products, but also textiles, appliances, and agricultural products.
The spokesperson for the European Commission, Olof Gill, stated on Thursday, just before Trump’s announcement, that the EU is “prepared for whatever comes, and we have been preparing for over a year. We call on the United States to immediately revoke the tariffs announced yesterday, and we want to negotiate to avoid tariffs in the future.”