The European Union's response to Trump

The The European Union's response to the tariffs imposed by Donald Trump around the world and which come into effect this Wednesday, is proving, for the moment, to be a smart one. Instead of going all out, as China seems to have chosen, Brussels is proposing selective tariffs on specific products, in order to minimize the damage to the European economy, and with a gradual implementation schedule that seeks to keep the door open to negotiations with Washington. Europeans hope that, if the rough seas in the markets continue and the United States begins to raise prices, the White House will agree to rectify and seek a consensual solution.

Thus, for example, the tariffs will come into effect between April 15 and May 16, depending on each product. And the most delicate ones, which affect soybeans and hazelnuts, would not come into effect until December. The European solution, then, is to act with a scalpel, in contrast to Trump's axe, which seeks to upend the entire global trading system that has been built over the last 75 years.

The European Union is therefore focused on avoiding a trade war, and Commission President Ursula von der Leyen has contacted Beijing to try to de-escalate tensions with Washington. The problem is that China doesn't seem willing to show any signs of weakness; in fact, its leaders may think they can win the trade war and emerge stronger from this crisis.

The coming days will be key to gauging the impact of tariffs on the markets and the real economy. It will also be time to see if the divisions within the Republican Party, with senators like Rand Paul completely opposed to tariffs, and even the confrontation between presidential advisor Peter Navarro, the main defender of these policies, and Elon Musk, end up changing Trump's policy. It will also be interesting to see the positioning of the big tech moguls who attended Trump's inauguration and have made moves to get closer to them and are now the main victims of the stock market declines. People like Jeff Bezos, owner of Amazon and the Washington Post, or Mark Zuckerberg of Meta, have seen tens of billions in their companies' value wiped out in just a few days. Will Trump apply some kind of pressure or will they do nothing to prevent disaster? What will consumers do if the prices of everyday products that can't be produced in the United States, such as coffee or bananas, skyrocket? What will happen when there's no longer the option of buying Chinese or Japanese cars cheaper than American ones? What will happen to giants like Apple, whose components are manufactured in different countries around the world?

Whatever happens, however, the European Union has an obligation to prepare for the worst-case scenario: a full-scale trade war with the United States. And this will require restructuring not only its own economy but also its relations with countries like China, with which, by a twist of fate, it now finds itself defending global free trade.