President of the United States, Donald Trump, has publicly declared a strategy to place another 10 percent tax on countries that do not agree with the US position on Greenland. This suggestion has received great disapproval from the United Kingdom and some of the European Union member states. International media reports suggest that the European Union is already considering some form of retaliation against this threat.
Tariff Threat Background
President Trump has been vocal in justifying the US claim over Greenland by arguing that it is a matter of national security. The President also made it clear that he was willing to take over the territory. Along with this viewpoint, he has threatened to impose tariffs against countries that are not siding with the US. Analysts believe that this is a move aimed at the trade policy manipulation of political pressure.
EU Emergency Meeting Right After Tariff Announcement in Brussels
- Right after the announcement, the representatives of the European Union convened an emergency meeting in Brussels. The conversations were based on the possible US tariffs options and the future of EU–US relations. The leaders of Europe stressed the importance of defending the economic interests of the Union.
- Emmanuel Macron, the French President, affirmed that the European Union would not succumb to the external pressure. He further stated that it was now time to think about the Union’s most powerful trade defense tool, commonly known as the “Trade Bazooka,” being used.
The “Trade Bazooka” Explained
- The “Trade Bazooka” is a concept that has been created to shield the EU from the economic pressure coming from outside the EU. In case of any major issues, the Union can react by imposing counter tariffs. It also has the right to prohibit the sale of foreign products and services in the European market.
- Furthermore, the mechanism might restrict the access of foreign companies to public contracts in the EU. This can have an impact on the US companies that are winning large and lucrative projects in the EU.
EU’s Intended Message
It is the opinion of the EU authorities that the use of this measure would convey a very clear message. The message would be that the European Union is ready to protect its economic and political interests. However, at the same time, leaders emphasize that dialogue is still essential, though not at the expense of economic pressure or threats.
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