As trade tensions continue to simmer, former President Donald Trump is once again rattling the cage — this time, threatening the European Union with a steep 17% tariff on food exports to the United States.
The pressure is building ahead of a critical July 9 deadline, and if no deal is reached, tariffs could skyrocket to as much as 50% on all EU goods headed for American shores.
And Europe? It’s not planning to take this sitting down.
Food and Farming First in the Firing Line
The 17% tariff threat appears to target food and agriculture — key sectors in the EU’s export economy.
Last year alone, the EU shipped nearly $58 billion worth of food products to the U.S., with wine, cheese, and specialty goods topping the list.
It’s still unclear whether the proposed food tariff would be on top of, or instead of, the wider 50% tariff Trump has also floated.
One of the World’s Biggest Trade Ties on the Brink
The U.S.-EU trade relationship is enormous — accounting for nearly 30% of the world’s total goods exchange.
In 2024, trade between the two sides hit about $1.98 trillion.
The EU generally exports more goods to the U.S. than it imports, giving it a goods surplus of €198 billion.
However, in services, the U.S. has the upper hand — leading to an overall EU trade surplus of around €50 billion.
But that delicate balance is now under threat.
Both Sides Prepare for a Showdown
If the U.S. moves forward with tariffs, European officials are expected to hit back hard.
EU retaliation would likely target American exports like food, alcohol, and tech — items with symbolic and economic punch.
The mood is tense, with some insiders calling this a major escalation between the longtime trade partners.
Officials on both sides are scrambling to find common ground.
European Commission President Ursula von der Leyen acknowledged that while they’re aiming for a basic agreement “in principle,” it’s unlikely a full deal can be hammered out in time.
A five-page draft agreement is reportedly in the works, but it’s filled with vague language and unresolved issues.
Trump’s Longstanding Grudge Against the EU
This isn’t the first time Trump has gone after the EU.
During his presidency and even since, he’s claimed the bloc was “formed to screw the United States.”
It’s part of a broader narrative where he accuses Europe of taking unfair advantage in trade.
His team, led now by Treasury Secretary Scott Bessent, seems cautiously hopeful but noncommittal.
“We’ll see what we can do,” Bessent told CNBC this week when asked about the July 9 deadline.
What the EU Wants From the Deal
According to reports, EU officials are willing to accept a baseline 10% tariff for most exports — but only if they get exemptions for key sectors.
That includes pharmaceuticals, aircraft, semiconductors, and alcohol — industries where transatlantic supply chains are deeply intertwined.
However, EU negotiators are grappling with conflicting demands from within their own ranks.
The 27 member states are far from united on how to respond to Trump’s threats.
Germany Pushes for Compromise, France Demands Toughness
Germany’s Chancellor Friedrich Merz is calling for a quick settlement.
As the leader of Europe’s largest and most export-reliant economy, he’s urging the European Commission to secure carve-outs from Trump’s planned 25% auto tariffs and 50% steel duties.
France, on the other hand, is taking a harder stance.
President Emmanuel Macron is standing firm on full reciprocity, warning that Europe shouldn’t give ground unless it gets equal treatment in return.
Clock Ticking Down to July 9
With less than a week to go, the fate of nearly $2 trillion in trade hangs in the balance.
Whether this ends in compromise or confrontation could redefine one of the world’s most important economic relationships — and both sides know it.
All eyes are now on the negotiators as the clock winds down.
