The EU’s Retaliatory Tariffs on US Imports: An Overview
On Wednesday, the European Union (EU) took a significant step in its ongoing trade dispute with the United States. The EU approved retaliatory tariffs on approximately $4 billion worth of American imports, effective from June 1, 2021. This move comes in response to the US’s decision to remove the preferential treatment of British Steel under the Generalized System of Preferences (GSP) in March 2021.
Background
The GSP is a US trade program that grants duty-free importation of goods from beneficiary countries. The UK was among the countries that enjoyed this privilege until the US Trade Representative (USTR) decided to remove it, citing the UK’s failure to meet the eligibility requirements. This decision led to a wave of protests from the UK and the EU, with both sides threatening retaliatory measures.
The EU’s Response: Tariffs on US Imports
The EU’s response came in the form of tariffs on a range of US imports, including products like bourbon, motorcycles, jeans, and Harley-Davidson motorbikes. The tariffs will range from 15% to 50%, depending on the product.
Impact on the EU and the US
The EU’s decision to impose tariffs on US imports could have far-reaching consequences for both sides. For the EU, this could lead to higher prices for consumers, as businesses pass on the additional costs. However, it could also provide a boost to EU producers, as they may see increased demand for their goods.
Impact on Consumers
For consumers in the EU, the tariffs could lead to higher prices for certain goods. For instance, the price of a pair of Levi’s jeans could increase by as much as 25%, while a Harley-Davidson motorbike could become 50% more expensive.
Impact on the World
The EU’s decision to impose tariffs on US imports could also have a ripple effect on the global economy. It could lead to a further escalation of trade tensions between the US and the EU, potentially undermining efforts to revive the global economy from the Covid-19 pandemic.
Conclusion
The EU’s approval of retaliatory tariffs on US imports marks a significant escalation in the ongoing trade dispute between the two sides. While the tariffs could provide a short-term boost to EU producers, they could also lead to higher prices for consumers and further trade tensions between the US and the EU. The long-term consequences of this development remain to be seen, but one thing is clear: the global trade landscape is becoming increasingly complex and uncertain.
- The EU approved retaliatory tariffs on $4 billion worth of US imports
- The tariffs come in response to the US’s decision to remove the preferential treatment of British Steel under the GSP
- The tariffs will range from 15% to 50%, depending on the product
- The tariffs could lead to higher prices for consumers in the EU
- The tariffs could have far-reaching consequences for the global economy
