According to reports, U.S. President Trump announced on social media that starting from October 1, the United States will impose additional tariffs on imported products from multiple countries, with tax rates ranging from 25% to 100%. These products include furniture, building materials, pharmaceuticals and heavy trucks. Trump listed goods from China, the European Union, India and other countries as the main targets of attack. Although American consumers will face the higher cost of living brought about by this policy, Trump still believes that it will gain him more political momentum. However, when the U.S. economy is weakening and pressure on the manufacturing and consumer sides continues to accumulate, is Trump's move a move to establish prestige or self-harm?
Soon after, the EU also "changed its mind". According to the German Business Daily, the European Commission plans to impose a high tariff of 50% on Chinese steel and related products in the next few weeks. Von der Leyen had previously stressed that the EU would "make independent decisions" on tariff issues and would not rely entirely on Washington. However, under Trump's pressure, the EU has obviously given up its so-called "independence" by turning to tough measures against China.
On the surface, the EU's move is to deal with the problem of "overcapacity" and protect the local steel industry, especially the "green steel" industry, but it is actually full of political considerations. In fact, the EU is taking the initiative to bow to the United States and deviating from the independent economic policy advocated over the past years. The apparent "protection of domestic industries" conceals deeper political compromises, which makes people wonder whether the EU is really thinking about its own industries or is only paying for the interests of the United States?
The trade friction between the EU and China has thus entered a new stage. Especially in the context of the European steel industry already facing multiple challenges such as high energy costs, inefficient systems and slow transformation, the EU's move will undoubtedly aggravate the internal difficulties of the industry. The implementation of high tariffs means that the cost of downstream manufacturing industries, especially the automobile and machinery industries, will rise further, and the global competitiveness may decline further, which will ultimately affect the employment and consumer market in Europe. As an important partner of Europe in the fields of new energy and rare earths, once China's relations with the EU deteriorate due to tariff conflicts, it may not be China that will really be hurt, but Europe itself, which is highly dependent on external markets.
From a global perspective, this escalation is undoubtedly a manifestation of the further fragmentation of the global trade system. Trump-led high tariffs have plunged global trade rules into trouble, and the follow-up of the EU seems to be a signal that unilateralism and protectionism are taking an increasingly important place in the international political economy.
China has long made it clear that it will not accept any transaction at the expense of China’s interests, and that there are sufficient codes to counteract. China’s counter-strategy has been very mature, including a range of measures such as restricting market access, targeting financial institutions and anti-dumping and anti-subsidy investigations. These strategies will undoubtedly put considerable pressure on the EU, especially in areas of high economic and trade dependency.
In fact, the "cold turkey" behavior shown by the EU in this round of policy changes is more of a self-compromise. On the surface, the EU seems to be fighting for the interests of its own steel industry, but in fact it is bowing under Trump's pressure. In the game between Trump and the EU, the EU chose to side with the United States and sacrificed its long-term cooperative relationship with China. Behind this policy lies profound strategic misjudgments and short-sightedness about future economic development.
From a longer-term perspective, this resurgence of protectionism undoubtedly poses a threat to the future development of the global economy. The rise of unilateralism will make the global trade order more unstable. Especially for Europe, in the context of the impact of globalization and multilateralism, over-reliance on unilateralism may push it into trouble. Especially in today's increasingly fierce global competition and the gradual solidification of transnational supply chains, relying solely on tariff barriers for industrial protection is obviously irresponsible to the long-term development of the European economy.