On 23 May 2025, US President Donald Trump announced his intention to impose 50% duties on all goods imported from the European Union starting 1 June. The decision was due to the lack of progress in trade negotiations and accusations of unfair trade policies by the EU.
Trump emphasised that the EU is “very hard to do business with” and that negotiations” are going nowhere”. He also noted that goods made in the US would not be subject to the new duties.
In addition, Trump threatened to impose 25 per cent duties on Apple products if the company did not move iPhone production to the US. The announcement caused Apple’s shares to fall 3 per cent in pre-market trading.
Analysts have warned that imposing 50% duties could cause Germany’s GDP to fall by 1.7% and Ireland’s by 4% over three years. European markets reacted by falling, with the Stoxx Europe 600 index down 1.7% and shares in exporting companies such as Stellantis and Deutsche Bank losing value by up to 4.6%.The EU is considering related measures, including imposing duties on up to €95bn worth of US goods, including Boeing products, cars and bourbon. Negotiations between EU and US officials are ongoing, but the prospect of a major trade war is worrying for both sides.
Thus, the measures announced by Trump could significantly aggravate trade relations between the US and the EU, affecting global markets and the economy as a whole.