Janice R. Andrews
US President Donald Trump has escalated trade tensions with the European Union, vowing to impose a 200% tariff on champagne and other alcoholic imports from the bloc. The announcement, made on Thursday, comes in response to the EU’s decision to levy a 50% tariff on $28 billion worth of US goods, including whiskey, as part of an ongoing trade dispute.
Trump criticized the EU’s trade policies, calling the bloc “one of the most hostile and abusive taxing and tariffing authorities in the World.” He urged the EU to withdraw its whiskey tariff, warning that failure to do so would prompt immediate US retaliation. The EU, however, defended its actions, with European Commission President Ursula von der Leyen stating the bloc must “act to protect consumers and business.”
The tit-for-tariff exchange has rattled financial markets, with stock futures dropping early Thursday. The S&P 500 and Nasdaq reversed gains, while Dow Jones Industrial Average futures extended losses. The trade standoff is part of a broader conflict that has seen retaliatory measures from other economies, including Canada and China.
The Trump administration recently doubled tariffs on Chinese imports to 20%, prompting China to target US agricultural exports. These escalating tensions have raised fears of a global economic downturn. Goldman Sachs and Moody’s Analytics have both revised their recession risk estimates upward, citing growing uncertainty from trade disputes.
As the US and EU trade war intensifies, businesses and consumers brace for higher costs and market volatility, with no immediate resolution in sight.
