How can the Spanish economy punish Trump?

BrusselsDonald Trump does not forgive Pedro Sánchez for refusing to take office. 5% of gross domestic product (GDP) in military spending and has threatened to charge him for it through trade retaliation"We are negotiating a trade agreement with Spain and we will make them pay double," threatened the US president at the press conference for the NATO summit in The Hague. Now, to what extent can the White House attack the Spanish economy and how?

First of all, it's worth remembering that the trade powers of the 27 member states, including Spain, are exclusively vested in Brussels. And, contrary to what Trump says, Washington is not negotiating an agreement to end the tariff war with the Spanish government, but with the European Commission. In fact, both sides have increased contacts for weeks and hope to reach an agreement in the coming days.

Therefore, if the Trump administration now insists on specifically punishing the Spanish economy, it should take measures against the EU as a whole, which could lead to a further escalation of the trade conflict between the two powers. Furthermore, Brussels can counterattack and already has a package of new tariffs against the United States ready in case the White House wants to raise customs duties again. In this regard, European Commission sources assure ARA that they are prepared to defend any member state in a trade dispute, including Spain.

Be that as it may, if the US president takes this step, he could attack the Spanish government by imposing tariffs on products it primarily imports from Spain. These include olive oil, wine, olives, electronic devices, and, among others, petroleum and mineral oils.

According to the Efe news agency, Spain exported olive oil alone to the United States for a total value of €1.013 billion, which is 58% more than the previous year. Regarding petroleum and mineral derivatives, Spanish exports to the US last year amounted to €2.028 billion, and electrical equipment to €772 million. Trade in the pharmaceutical sector is also significant: sales of medicines will reach €571 million in 2024, and sales of birth control devices and car accessories to €249 million.

It wouldn't be the first time the US or the EU have specifically attacked products from a specific country or region. Trump, for example, is obsessed with French champagne and wine, and Brussels has threatened to target him. iconic products of the United States that are manufactured in states where the New York magnate has obtained strong electoral results. Some of these items include Levi's jeans, Harley Davidson motorcycles, and bourbon whiskey, which is produced primarily in Kentucky.

Despite these exports, Spain is one of the EU member states least exposed to the US. In fact, the European Commission's latest economic forecasts lowered the eurozone's growth outlook by four-tenths of a percentage point, placing the GDP growth rate at 0.9% in 2025. In contrast, it revised the Spanish economy's outlook even further upwards by three-tenths of a percentage point, to 2.6%. Brussels estimates that if Spain ends up being damaged by Trump's trade war, it would be indirectly, due to a slowdown in economic activity in other neighboring countries, such as Germany, Italy, and the Netherlands, which are major exporters to the US.

In this regard, Sánchez reminded Trump that Spain has a trade deficit with the US superpower. That is, it imports more American products than it exports. And yet, he laments that the Republican administration has already punished the EU economy, and therefore Spain's, with "unfair" and "unilateral" measures. In fact, Washington has already increased customs duties on all products imported from the EU by 10%, by 50% on aluminum and steel components, and by 25% on cars manufactured in EU countries.