Tariffs: EU holds fire on US spirits in tit-for-tat trade war

The EU executive is postponing until mid-April a set of retaliatory tariffs on US products including iconic Bourbon whiskeys.

Announcing the move today, the Commission said it wanted more time to consult governments and to allow all countermeasures – the first set which was due to come into force on 1 April and a second scheduled for mid-April – to be assessed together.

President Trump threatened the European wine and spirits sector with a whopping 200% import tariff immediately after the EU unveiled its lists on 12 March in retaliation to a 25% levy on imports of steel and aluminium to the US.

Trade commissioner Maroš Šefčovič sought to reassure MEPs on Thursday as they warned of potential harm to European drinks producers. “We of course clearly understand this concern, we are in touch and have spoken to the spirit industry,” the Slovak commissioner said. “Therefore, we merged the two lists, so we can have more consultations on this regard.”

The European countermeasures include a list of US products that was drawn up during an earlier trade dispute during Trump’s first term, which has already been approved by EU governments. A second list of products is set to enter into force mid-April after adoption by member states.

In response to pleas from affected industries, the whole package will now be treated as one, allowing for a potential rethink of the earlier list, with a view to entry into force in mid-April. Italy, France and Spain are among the top five exporters of wine to the US, and the new approach could work in their favour.

“Bourbon isn't going to get us anywhere with the Americans – it would be better for the Commission to take a more global and strategic approach,” a representative of the EU wine and spirits industry told Euronews. “We have no interest in a trade war, it would be bad for the whole economy.”

Washington is expected to unveil further US tariffs in a fortnight, with the Trump administration signalling they will be a “reciprocal” response to what it regards as EU trade barriers. Šefčovič said he wants to see the next move from the US before Brussels can “calibrate [its] response accordingly”.

In the meantime, he hoped the US government was open to negotiation. “The US plans to impose reciprocal tariffs on 2 April,” Sefcovic said. “For them, this should serve as a baseline for redefining and rebuilding US trading relations with the rest of the world. Only then may partners be able to engage on possible negotiations.”

Sefcovic travelled to Washington in February to meet US Commerce secretary Howard Lutnic. On Thursday, the commissioner told MEPs that ongoing discussions cover five areas: cars, chips, timber, steel and aluminium, and pharmaceuticals.

On cars, he suggested to engaging in talks on the mutual recognition of certification standards. “But we are not yet there,” Sefcovic said, explaining the American side was for now preoccupied with preparations for 2 April. “For all these discussions you need a partner; you need to be two to tango.”