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Trade war and peace: Three scenarios and policy options available to the EU and the German government in negotiations with president Trump

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  • von Daniels, Laura

Abstract

The United States (US) and European Union (EU) are at risk of entering a full-blown trade war. Three months ago, on "Liberation Day", US President Donald Trump imposed high import tariffs on almost all countries, including the EU. He then suspended them at short notice to negotiate with over 90 of the affected trading partners. At the beginning of July, when the tariffs were due to come into force, Trump again postponed the tariffs on the EU and other countries by an additional month. In a letter to the EU, Trump threatened higher tariffs, namely 30 per cent, from 1 August. This back and forth shows that Member States must prepare for an escalation of the conflict - one that could go far beyond tariffs and even jeopardise the security of the EU.

Suggested Citation

  • von Daniels, Laura, 2025. "Trade war and peace: Three scenarios and policy options available to the EU and the German government in negotiations with president Trump," SWP Comments 33/2025, Stiftung Wissenschaft und Politik (SWP), German Institute for International and Security Affairs.
    • Handle: RePEc:zbw:swpcom:324886
    DOI: 10.18449/2025C33
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