European Union flags flutter outside the European Commission headquarters in Brussels, Belgium April 9, 2025. REUTERS/Yves Herman
President Donald Trump is threatening a sweeping 50% tariff on the European Union (EU) and a 25% levy on Apple Inc if the tech giant failed to move iPhone manufacturing to the United States, reigniting investor fears about his trade agenda.
Trump said last Friday in a social media post that the higher charge on the EU would start on June 1 because “our discussions with them are going nowhere”, adding he saw the bloc as “very difficult to deal with”.
Separately, Trump posted that he already told Apple the company’s popular smartphones should be made in the United States and that he was nonplussed by its effort to partially move production from China to India.
Futures for the S&P 500 Index fell 1.1% while Nasdaq 100 futures declined 1.3% last Friday morning after Trump’s threats.
European stocks extended their declines to the worst day since April 9, with traders fearful the tariffs would impact automobile manufacturers and luxury goods.
The president’s missives represented a fresh round of trade brinkmanship, after indicating last week he was looking to wind down talks with partners over his April 2 duties, which he paused for 90 days to allow for negotiations.
Trump’s attention last week had mostly been focused on a massive tax and spending package currently being considered by the US Congress.
Trump’s latest posturing comes after the EU earlier last week shared a revived trade proposal with the United States in a bid to jump-start talks.
The European Union’s trade chief, Maros Sefcovic, had been planning to hold a call with Jamieson Greer, his US counterpart, last Friday to take stock of negotiations, a European Commission spokesperson said before Trump’s post.
The new framework includes measures that take into account US interests, including international labour rights, environmental standards, economic security and gradually reducing tariffs to zero on both sides for non-sensitive agricultural products as well as industrial goods, according to people familiar with the matter.
It also outlined areas where the United States and EU could cooperate, such as mutual investments and strategic procurement in energy, artificial intelligence and digital connectivity.
But there were signals the negotiations were not proceeding well.
One EU official described the prior US proposal as a wish list of unrealistic and unilateral demands, Bloomberg reported.
The EU is aiming to cooperate with the US, and is seeking a balanced and mutually beneficial deal.
EU officials and many member states remain sceptical that the Trump administration is driven by similar goals.
US Commerce Secretary Howard Lutnick last Wednesday said at an Axios event that some trade negotiations had proved “impossible”.
That echoed comments last week from US Treasury Secretary Scott Bessent, who said the bloc suffers from a collective-action problem on trade.
Trump, in his social media post, reiterated his claim the EU, which was established to promote peace and stability in Europe following World Wars I and II, had been “formed for the primary purpose of taking advantage of the United States on TRADE”.
The EU plans to move forward with preparing countermeasures if negotiations fail to produce a satisfactory outcome.
The trade bloc has put together plans to hit 95bil or about US$107bil of US exports with additional tariffs in response to Trump’s “reciprocal” levies and 25% tariffs on cars and some parts.
But Trump has also indicated he’s not done with tariffs. Trump in recent days has signalled he plans to press ahead with plans to impose import taxes on semiconductors and pharmaceutical imports, and has threatened charges on foreign-made films and aircraft parts. — Bloomberg
Skylar Woodhouse writes for Bloomberg. The views expressed here are the writer’s own.
