The entrance to one of the Google buildings in the “Silicon” sidewalks in central Dublin, Ireland, on Tuesday, November 29, 2022.
Bloomberg Bloomberg Gety pictures
The European Union says it keeps all options open if it fails to negotiate on its way out of the huge definitions of the 20 % of US President Donald Trump – and this may include after great great technology.
Before announcing the tariff on Wednesday – which he has Amazing global markets With Domain and size – UNHCR president Ursula von der Layen said that when drafting its response, Europe “carries a lot of cards, from trade to technology to the size of our market.”
“This force is also based on our willingness to take anti -company measures. All tools are on the table,” said von der Layen on Tuesday. Repeat on Thursday.
As a bloc, the European Union is the largest commercial partner for the United States through goods, services, investment, and trade between spouses Almost balanced when accounting for both goods and services.
But when calculating the so -called “revenge definitions”, it appears that the American administration has controversially He only looked at the trade deficit of countries In goods with the United States, this gap is considered a “tariff” on the United States – the main exporters such as Vietnam and Sri Lanka fell more than 40 %.
For the European Union, this means a 20 % tariff because of the United States The goods deficit about 235.6 billion dollars. Trump has taken in recent months in particular with the commercial relationship of the United States with the 27 countries, Accuse By dealing with the largest economy in the world “very badly” and making it “it is very difficult to bring (United States) products to Europe” while selling there.
One of the areas where the European Union is a main market for US business in services and technology companies, Holgger Schmiding, chief economist in Bernberg, said on Wednesday.
“While the European Union will not be divided significantly now, it is possible that it will threaten to do so if negotiations do not result in a result by mid -year,” he said. Schmiding said that while the issue of the economic basis is approximately half of the additional American definitions on the imports of the European Union that are negotiated by the end of the second quarter, technology companies are a means of “the European Union”.
Such measures may take a form of tougher regulations on large technology, or by using an ACI tool to delay the issuance of business licenses for American companies, reduce access to public contracts, restrict intellectual property rights or prohibit explicit investments in the European Union, according to Carsten Braski, global head of Macro.
He said that the specific goals can include application stores, mobile phones, cloud services and other areas such as where the data is stored.
With a few local technology giants, Europe has a huge appetite for products and services appleand Googleand Amazonand Deadand Microsoftand Intel And LinkedIn. Many have a regional headquarters in the Irish capital Dublin, which is originally attracted by it Low corporate tax rate – along with the big names in the American pharmaceutical and financial services industries.
The European Union has already taken steps to suppress large technology. Mass Digital Markets Law (DMA)For example, it aims to address the market strength of the large “Gate Guard” companies such as Google, Apple, Meta, Amazon and Microsoft.
Last month, the European Commission – the European Union Executive Authority – Google Pateer Compane Alphabet is charged with DMA breaching and issued Apple IPHONE maker’s demand to do more to comply with the law. Trump has previously cited the organizational actions of the European Union against the American technology giants as a cause of the mass strike with definitions. In February, the block threatened definitions to deal with “blackmail abroad” for American technology companies through digital taxes and fines.
The technology giants in the United States will now struggle with the repercussions of the supply chain from Trump’s tariff policies, with Many depend on the components and assembly lines in Asia. apple The shares have suffered from its worst loss since 2020 on Thursday, a decrease of more than 9 %, amid a large -scale technology.
Dan Evs, international head of technology research at Wedbush Securities, said in a memorandum earlier this week that American technology faces frozen budgets and levels of uncertainty in the era of Covid, and may not be issued during the first quarter profit season.
The harm to European consumers
However, Brzeski’s Brzeski also indicated that the age of counter -measures under ACI will require approval of 15 of 27 members of the European Union, and it will take about eight weeks to implement them, and can meet other technical obstacles.
He also stressed that going to digital services in the United States will be the “nuclear option” in the European Union’s commercial policy group.
“Not only because it will be unprecedented, but also because it is likely to lead to strong revenge on the United States and will also harm European customers, because the region currently has very few local alternatives for American digital services,” CNBC told CNBC.
“To some extent, the European Union, which targets our digital services, will actually be the spitting picture of what Trump just announced: it will be a measure that harms commercial partners, but at the expense of local consumers.”
And Andrew Kiningham, the chief economist in Europe in Capital Economics, said in a note on Friday that although the European Union policymakers were more likely to consider taxes on services or use ACI, he eventually expected that the European Union’s response was “measured fairly”.
He said: “The European Union will aim to reduce the risk of escalation and maintain the remaining American trade relationship in the long run. Politics makers also realize negotiations on defense and security.”
“So, while European Union leaders were quick to criticize the definitions, they also made it clear that they were open to negotiations.”
Ryan Brown of CNBC contributed to this story.
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