The new customs tariffs imposed by the United States against the European Union (EU) will lead to increased costs both in the US and in Europe, warned Member of the European Parliament (MEP) Inese Vaidere (New Unity).
She expressed doubts whether US President Donald Trump fully understands the consequences of his decisions, suggesting that he may still be “playing to the public” by talking about “making America great again”.
Vaidere emphasized that global free trade and balanced trade relations have helped to maintain stable product prices and limit price increases through competition. However, with the imposition of tariffs by the US, prices for goods will inevitably rise on both sides of the Atlantic. She pointed out that the EU has a positive trade balance with the US.
She highlighted that Europe’s automotive industry, particularly in Germany, will be hit hard by these tariffs. German-made vehicles, such as Mercedes and BMW, are popular among American consumers, and driving them is considered prestigious in the US.
Regarding Latvia, Vaidere noted that the initial economic impact may be limited, since Latvia’s trade volume with the US is relatively small.
However, she stressed that Latvia’s economy is closely linked to other EU member states, and over time, the effects of trade restrictions will certainly be felt.
According to the MEP, EU exports could decline, as goods will become more expensive due to the tariffs, making them less competitive. Vaidere said Europe is willing to continue importing energy, raw materials, and various products from the US, but these goods will also become more expensive if the EU is forced to introduce retaliatory tariffs.
“The inflation spiral could escalate in both Europe and the US, as well as in countries facing high tariffs – such as China, Vietnam, Cambodia, and Thailand,” she warned.
Vaidere stressed that what has been achieved in free trade can be quickly destroyed but rebuilding it will be far more difficult. She noted that the European Parliament’s Committee on International Trade, where she is a full member, will discuss further action early next week.
“We should always aim for an agreement and start with negotiations, but in this case, I doubt the talks will be fruitful. Europe must remain united, and if negotiations fail, we must respond with firm and symmetrical measures,” Vaidere said, expressing hope that the European Commission will act quickly and decisively, especially considering Germany’s auto industry is significantly affected.
Speaking about the possible effect of EU countermeasures, she pointed out that there might be a silver lining — customs revenue could increase both in Latvia and other EU member states that trade with the US, which would benefit the EU as a whole. If customs revenue does rise, Vaidere suggested it could become a valuable resource for current EU priorities — such as security, defence, and strengthening the defence industry. The MEP noted that it was still being estimated how much this revenue could be.
Regarding future EU-US relations, Vaidere said they are unlikely to improve in the near term,
as Trump’s move has angered leaders of countries that were traditionally friendly toward the US. Nonetheless, she stressed that the US remains a key strategic partner, even if some decisions are made unilaterally by the president and his close supporters.
“We must maintain our relationship with the US and try to find common ground where cooperation is mutually beneficial,” she said. “We also don’t know if public support for Trump will remain strong once Americans begin to feel the real cost of rising prices.”
As previously reported by LETA, Trump announced new tariffs on foreign imports, including high tariffs on key trading partners like China and the EU. A 10% tariff is set to take effect on the 5th of April, with higher tariffs following on the 9th April.
The EU is facing a 20% tariff and has already been hit by previous tariffs on steel, aluminium, and automobiles and auto parts. The EU had planned to respond with its own tariffs on the 1st of April and in mid-April, but on the 20th of March, the EU decided to delay the introduction of its tariffs by two weeks, allowing more time for dialogue.
The 25% US tariff on global steel and aluminium imports took effect on the 12th of March, prompting the EU to prepare two rounds of retaliatory tariffs. The first round (set for the 1st of April) was to affect four billion euros worth of US goods, including whiskey, motorcycles, jeans, and orange juice.
The second round, planned for mid-April, would cover a broader range of products — including cosmetics, clothing, wood, soybeans, and other agricultural goods.