EU Tariff Response Has to Be WTO-Compliant, Sweden Official Says

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The European Union will make sure that any response to US tariffs must be compliant with World Trade Organization rules, according to Sweden’s trade minister, potentially limiting the bloc’s options to retaliate.  

“There is a broad consensus among member states and the commission that the WTO at its core is important to maintain,” Benjamin Dousa said in an interview with Bloomberg Wednesday. 

President Donald Trump has threatened to slap 25% tariffs on automobile, semiconductor, steel and aluminum imports. He’s also said the US will impose reciprocal duties on imports in an attempt to address grievances over how countries choose to tax and regulate. 

The EU has prepared multiple lists of American goods to hit with retaliatory tariffs if Trump moves forward with levies, modeling various possibilities depending on what the initial US salvo looks like, Bloomberg reported earlier. The bloc could move quickly by re-applying duties it first imposed on the US during Trump’s first term. 

“We have several other ongoing free trade negotiations now,” Dousa said. “If we are to be a reliable partner, if we keep saying that everyone else should stick to the WTO, then we have to do it ourselves.”

The Swedish trade chief said he would “rather see a solution where tariffs go down, rather than go up,” and that within the WTO “there clearly is room” to lower tariffs toward the rest of the world.

“It’s not Sweden that has been pushing for high tariffs within the framework of the WTO regulations. But it’s important that they remain WTO-compatible,” he said.

“In practice, it would mean that tariffs are lowered toward all countries that are members and where we do not have a free trade agreement. But I think it is perfectly reasonable that we review the tariff levels that we have vis-à-vis other countries as well.”

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