Europe, Only 'Negotiation Mode' Outwardly... Likely to Target US Big Tech with 'Large Europe Surplus'

Considering Retaliatory Measures in the Service Sector
U.S. Holds 109 Billion Euro Surplus in Services
EU Had Prior Knowledge of Reciprocal Tariff Details

In response to U.S. President Donald Trump's tariff assault on automobiles, the European Union (EU), which has shown a cautious 'negotiation mode' stance, is reportedly preparing retaliatory measures targeting American big tech companies. Compared to several countries that have yet to grasp even the framework of the reciprocal tariff measures scheduled for April 2, Europe has relatively concrete policy details and has established a strategic response posture.

According to the British daily Financial Times (FT) on the 27th (local time), the EU is considering retaliatory measures against the U.S. service sector, including American big tech firms, in response to the 25% tariffs on imported U.S. automobiles and parts. It is expected that the EU will leverage its broad authority under the 'implementing regulations' to suspend intellectual property rights (IP) or exclude companies from public procurement contracts.

So far, the EU has countered the U.S. claims of 'damage' based on goods trade balance by pointing out that the U.S. runs a surplus in services trade. This is due to the enormous profits generated by American big tech companies such as Google, Meta (formerly Facebook), and Amazon. In fact, as of 2023, the U.S. recorded a 157 billion euro deficit in goods trade with the EU but a 109 billion euro surplus in services trade. An anonymous EU diplomat told the FT, "The U.S. believes it holds a definite advantage in this trade war, but we also have the capability to escalate," adding, "The ultimate goal is to ease tensions through a comprehensive trade agreement."

The EU is also considered to have an edge over other countries in diplomacy and intelligence. According to the FT and U.S. political media outlet Politico, Europe had prior knowledge that the U.S. would uniformly apply reciprocal tariffs of 20-25% to the 27 EU member states. They also understood that these tariffs would be applied in addition to general tariffs on items such as steel, aluminum, and automobiles. This information was obtained during meetings on the 25th between Maro? ?ef?ovi?, EU Commissioner for Trade and Economic Security, and U.S. officials including Commerce Secretary Gina Raimondo and USTR Representative Jayme White.

However, externally, the EU is maintaining a cautious stance. Ursula von der Leyen, President of the European Commission, expressed regret in a statement the day after President Trump's announcement but left room by saying she is "open to negotiations." This is a much more measured approach compared to Canadian Prime Minister Mark Carney, who declared the end of the alliance by stating, "The long-standing relationship with the U.S. is over." She stated, "We will evaluate this announcement along with other measures the U.S. is considering." This is interpreted as meaning that the EU will determine a comprehensive response strategy after reviewing the reciprocal tariff details that the U.S. plans to announce on April 2.