European leaders are choosing caution over confrontation as they respond to U.S. President Donald Trump’s latest escalation in the transatlantic trade standoff. Over the weekend, Trump announced a new round of “reciprocal” tariffs of 30% on European goods, set to take effect from August 1. Despite months of negotiations, the EU has yet to reach a trade deal with Washington — and the pressure is mounting.
In response, European Commission President Ursula von der Leyen confirmed on Sunday that the EU would postpone planned counter-tariffs on $21 billion worth of U.S. goods, originally scheduled for implementation this week. She emphasized that dialogue would continue until the August deadline.
Behind the Scenes: A Divide in Brussels
While EU ambassadors and most member states supported the Commission’s cautious stance during a briefing yesterday, internal frustrations are growing.
“It’s quite embarrassing how timid and powerless we are being in this process,” said one senior EU diplomat.
“We were told it would be a negotiation between partners, but it’s basically us sitting and waiting for [Trump] to make a decision.”
A second retaliatory package covering an estimated $78 billion in U.S. imports is expected to be circulated among EU member states today for deliberation. Publicly, EU ministers will likely stress unity and preparedness to act. Privately, many are hoping for financial markets to exert pressure on Washington and provide leverage in talks.
Austrian Chancellor Christian Stocker described Trump’s announcement as “regrettable,” while assuring the public that “the EU will respond in a united manner.”
Strategic Restraint Amid War in Ukraine
The EU’s hesitation reflects concerns that a forceful retaliation could trigger broader U.S. countermeasures — such as cutting military aid to Ukraine or reducing the U.S. troop presence in Europe. One diplomat described Trump as having “escalation dominance,” citing fears that any EU response could be met with a harsher U.S. reaction.
“The context of the war in Ukraine inevitably limits the scope for action,” said Ignacio Garcia Bercero, a former Commission official and senior fellow at Bruegel.
“Everyone is facing the challenge of dealing with a mad rhino.”
Business Community Pushes Back
Across the EU, business leaders and farming groups are urging caution. Many argue that retaliatory measures could invite further instability and provoke even steeper U.S. tariffs. Some business groups have expressed a preference for fixed tariffs over Trump’s unpredictable policy swings.
Despite the calls for calm, EU leaders acknowledge that if talks with Washington fail, countermeasures will be inevitable.
Also on the EU Agenda:
1. Online Child Protection Pilot
Five EU countries — Denmark, France, Italy, Spain, and Greece — will begin testing a new age verification app today. The app is part of broader EU efforts to regulate digital safety for minors. It will allow users to verify age without sharing personal data and is a precursor to the EU’s Digital Identity Wallet, expected in 2026.
2. Tech Accountability Guidelines
The EU is releasing new guidelines on digital safety, including recommendations to prevent addictive platform design, cyberbullying, and exposure to harmful content.
EU tech commissioner Henna Virkkunen has urged companies like Meta and TikTok to voluntarily adopt protections for minors.
“Platforms have no excuse to be continuing practices that put children at risk,” she said.
What Else to Watch Today:
- NATO Secretary-General Mark Rutte begins a two-day visit to Washington.
- EU trade ministers and agriculture ministers meet in Brussels.
- The Netherlands, one of Europe’s fastest movers in energy transition, is facing grid challenges that are driving up power costs.
As geopolitical tensions rise and trade risks intensify, EU policymakers are trying to hold their ground while avoiding further escalation. The coming weeks will test whether cautious diplomacy — or retaliatory pressure — will win out.
