US President-elect, Donald Trump has threatened the European Union with tariffs if the bloc does not reduce its trade gap with Washington through large-scale purchases of American oil and gas.
Trump made the threat in a post on his Truth Social platform, stating that the EU must make up for its “tremendous deficit” with the US.
According to US figures, the EU had a trade surplus of $202.5 billion with the US in 2022, with goods imports from the EU totaling $553.3 billion and US exports to the bloc totaling $350.8 billion.
Trump has made similar threats to other major US trading partners, including Canada, Mexico, and China, which could have significant repercussions for the global economy.
The EU has recently concluded a major trade deal with four South American countries, aiming to create a 700-million-customer free-trade area.
EU Commission Chief Ursula von der Leyen has stated that the agreement will build trade bridges despite “strong winds blowing in the opposite direction, towards isolation and fragmentation,” a comment seen as a nod to Trump’s tariff threats.
Some analysts believe Trump’s tariff threat may be an opening shot for leverage in future trade negotiations, while others see it as a genuine attempt to address the US trade deficit.
Trump has consistently argued that “properly used” tariffs would be positive for the US economy, stating that “our country right now loses to everybody” and that “tariffs will make our country rich.”
