The European Union has a €21 billion ($24.52 billion) package of tariffs on U.S. goods ready for implementation should ongoing trade negotiations falter, Italy’s Foreign Minister Antonio Tajani stated in a newspaper interview on Monday, as reported by Reuters.
What Happened: This readiness comes in response to U.S. President Donald Trump‘s recent threat to impose a 30% tariff on imports from both Mexico and the EU beginning Aug. 1, following weeks of inconclusive discussions with major trading partners.
According to Reuters, Tajani informed the daily Il Messaggero that a second set of tariffs could follow the initial €21 billion package if a comprehensive deal with the U.S. proves unattainable.
Despite the escalating tensions, Tajani expressed confidence in the potential for progress in negotiations, emphasizing that “Tariffs hurt every one, starting with the United States.”
He further warned that declining stock markets due to tariffs would jeopardize “the pensions and the savings of the Americans,” advocating instead for a goal of “zero tariffs” and an open market spanning Canada, the United States, Mexico, and Europe.
Why It Matters: In related developments, the EU announced on Sunday its decision to extend the suspension of countermeasures to U.S. tariffs until early August, aiming to continue pushing for a negotiated settlement.
Reuters also highlighted comments from German Chancellor Friedrich Merz, who on Sunday pledged to collaborate closely with French President Emmanuel Macron and European Commission President Ursula von der Leyen to de-escalate the burgeoning trade dispute.
Echoing the sentiment for a resolution, European Trade Commissioner Maros Sefcovic stated on Monday that Washington and Brussels were nearing a mutually beneficial outcome, cautioning that a 30% tariff would effectively “practically eliminate trade.”
In a Sunday post on X, Peter Schiff cautioned against Trump’s rationale for 30% tariffs, which states that reducing trade deficits with these regions signifies unfair economic arrangements.
Schiff, however, disputes this premise, contending that these deficits stem from more profound structural issues within the American economy, rather than being a consequence of disadvantageous or inequitable trade agreements. “He blames unfair trade for our deficits,” Schiff stated, further clarifying that these deficits are, in fact, “the result of excessive debt and consumption, alongside inadequate savings and investment.”
The SPDR S&P 500 ETF Trust (NYSE:SPY) and Invesco QQQ Trust ETF (NASDAQ:QQQ), which track the S&P 500 index and Nasdaq 100 index, respectively, were lower in premarket on Monday. The SPY was down 0.32% at $621.60, while the QQQ declined 0.34% to $552.31, according to Benzinga Pro data.
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