BANGKOK (AP) â U.S. President Donald Trumpâs announcement of a new 20% tariff on the European Union drew a sharp rebuke from European Commission President Ursula von der Leyen.
She said it was a major blow to the world economy and the consequences âwill be dire for millions of people."
Groceries, transport and medicines will cost more, she said, âAnd this is hurting, in particular, the most vulnerable citizens.â
Von der Leyen acknowledged that the world trading system has âserious deficienciesâ and said the EU was ready to negotiate with the U.S. but also was prepared to respond with countermeasures.
THIS IS A BREAKING NEWS UPDATE. APâs earlier story follows below.
BANGKOK (AP) â The announced Wednesday by U.S. President Donald Trump were met initially with measured reactions from key trading partners, highlighting the lack of appetite for a full-fledged trade war.
Trump presented the import taxes, which he calls âreciprocal tariffsâ and range from 10% to 49%, in the simplest terms: the U.S. would do to its trading partners what he said they had been doing to the U.S. for decades.
âTaxpayers have been ripped off for more than 50 years,â he said. âBut it is not going to happen anymore.â
The president promised that âJobs and factories will come roaring back into our country.â He framed it not just as an economic issue, but a question of national security that threatens âour very way of life.â
Financial markets were jolted, with U.S. stock futures down by as much as 3% early Thursday and Tokyoâs market leading losses in Asia. Oil prices sank more than $2 a barrel and the price of bitcoin dropped 4.4%.
âNobody wants a trade warâ
Shortly after Trump's announcement, the British government said the United States remains the U.K.âs âclosest ally.â
Business Secretary Jonathan Reynolds said the U.K. hoped to strike a trade deal to âmitigate the impactâ of the 10% tariffs on British goods announced by Trump.
âNobody wants a trade war and our intention remains to secure a deal," said Reynolds. "But nothing is off the table and the government will do everything necessary to defend the U.K.âs national interest.â
Italyâs conservative Premier described the new 20% tariffs against the European Union as âwrong,â saying they benefit neither side.
âWe will do everything we can to work towards an agreement with the United States, with the aim of avoiding a trade war that would inevitably weaken the West in favor of other global players,â Meloni said in a Facebook post.
Brazil's government said it was considering taking the case to the World Trade Organization. And later, in a rare display of unity, Brazilâs Congress unanimously passed a reciprocity bill to allow its government to retaliate against any country or trade bloc that imposes tariffs on Brazilian goods.
âMinimize damageâ
Asian countries that are among the biggest exporters to the U.S. pledged to take swift action to support automakers and other businesses likely to be affected.
South Korea's acting leader, Prime Minister Han Duck-soo told officials to work with business groups to analyze the potential impact of the new 25% tariff to âminimize damage,â the trade ministry said.
China's commerce ministry said Beijing would âresolutely take countermeasures to safeguard its own rights and interests,â without saying exactly what it might do. China has reacted to earlier rounds of higher tariffs by imposing higher duties on U.S. exports of farm products, while limiting exports of strategically important minerals used for high-tech industries such as electric vehicles.
âChina urges the United States to immediately cancel its unilateral tariff measures and properly resolve differences with its trading partners through equal dialogue,â it said.
âNo basis in logicâ
Some countries took issue with the White House's calculations.
Australian said the U.S. tariffs imposed on his country were totally unwarranted, but Australia will not retaliate.
âPresident Trump referred to reciprocal tariffs. A reciprocal tariff would be zero, not 10%,â said Albanese. The U.S. and Australia have a free trade agreement and the U.S. has a $2-to-$1 trade surplus with Australia. âThis is not the act of a friend.â
Trump said the United States bought $3 billion of Australian beef last year, but Australia would not accept U.S. beef imports. Albanese said the ban on raw U.S. beef was for biosecurity reasons.
The 29% tariff imposed on the tiny South Pacific outpost of Norfolk Island came as a shock. The Australian territory has a population of around 2,000 people and the economy revolves around tourism.
âTo my knowledge, we do not export anything to the United States,â Norfolk Island Administrator George Plant, the Australian governmentâs representative on the island, told the AP Thursday. âWe donât charge tariffs on anything. I canât think of any non-tariff barriers that would be in place either, so weâre scratching our heads here.â
New Zealand also took issue with Trumpâs tariff logic.
âWe donât have a 20% tariff rate,â said trade minister Todd McClay, adding that New Zealand was âa very low tariff regimeâ and the correct figure was below the 10% baseline rate applied by the U.S. to all countries.
âWe wonât be looking to retaliate. That would put up prices on New Zealand consumers and it would be inflationary,â he said.
Spared for the moment from the latest round of tariffs were Mexico and Canada, for goods already qualified under their free trade agreement with the United States. Yet, previously announced were scheduled to take effect at midnight.
Mexico President Claudia Sheinbaum said Wednesday she would wait to take action on Thursday when it was clear how Trumpâs announcement would affect Mexico.
âItâs not a question of if you impose tariffs on me, Iâm going to impose tariffs on you,â she said Wednesday morning. âOur interest is in strengthening the Mexican economy.â
Canada had imposed retaliatory tariffs in response to the 25% tariffs that Trump tied to the trafficking of fentanyl. The European Union, in response to the , imposed taxes on 26 billion eurosâ worth ($28 billion) of U.S. goods, including bourbon, prompting Trump to threaten a 200% tariff on European alcohol.
Little to gain
As Trump read the list of countries that would be targeted Wednesday, he repeatedly said he didnât blame them for the trade barriers they imposed to protect their own nationsâ businesses. âBut weâre doing the same thing right now,â he said.
âIn the face of unrelenting economic warfare, the United States can no longer continue with a policy of unilateral economic surrender,â Trump said.
Speaking from a business forum in India, warned that such measures, in addition to causing uncertainty, challenge the âmutually agreed rulesâ and the âprinciples that govern international trade.â
Colombia President Gustavo Petro, who has clashed with Trump before, said via X that the tariffs marked a global milestone: âToday the neoliberalism that proclaimed free-trade policies all over the world has died.â
Analysts say thereâs little to be gained from an all-out trade war, neither in the United States or in other countries.
âOnce again, Trump has put Europe at a crossroads,â said Matteo Villa, senior analyst at Italyâs Institute for International Political Studies.
âIf Trump really imposes high tariffs, Europe will have to respond, but the paradox is that the EU would be better off doing nothing,â he added, noting that the EU bloc depends more on exports to the U.S. than vice versa..
âOn the other hand, Trump seems to understand only the language of force, and this indicates the need for a strong and immediate response,â Villa said. âProbably the hope, in Brussels, is that the response will be strong enough to induce Trump to negotiate and, soon, to backtrack.â
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AP journalists around the world contributed to this story.
The Associated Press
