After lengthy negotiations with the EU, US President Donald Trump abruptly escalates the trade war with a warning on Truth Social that EU goods will receive a 30 percent tariff.

The 30 percent tariff on the EU and Mexico, two of the United States' largest trading partners, will take effect from August 1, according to the letters that Trump has sent to the two.

Trump writes that the United States will continue to cooperate with the EU, despite the large trade deficit that he calls a national security threat.

– Nevertheless, we have decided to move forward, but only with more balanced and fair trade. Therefore, we invite you to participate in the extraordinary economy of the United States, arguably the largest market in the world, Trump writes in the EU letter, which is addressed to European Commission President Ursula von der Leyen.

– We have had several years to discuss our trading relationship with the EU, and we have decided that we must move away from these long-term, large and persistent trade deficits, he writes.

–Unfortunately, our relationship has been far from mutual, he adds.

Countermeasures if necessary

Von der Leyen responds to Trump's escalation of the trade war by saying that the EU will do what is necessary to defend the interests of EU countries, including countermeasures if necessary.

But she stresses that the EU will continue to work towards an agreement by August 1, which has been a priority for the EU throughout. She says that such a high tariff on EU products would be highly disruptive to transatlantic supply chains.

French President Emmanuel Macron condemns Trump's tariff warning and says the EU must now prepare to introduce countermeasures.

“This comes after several weeks of intense engagement on the part of the EU, based on a good offer, in good faith. More than ever, it is now up to the European Commission to underline the Union's firm determination to defend European interests resolutely,” he says.

Three EU officials tell Reuters that they believe the threat of a 30 percent tariff from August 1 is a negotiating tactic.

Earlier this week, EU Trade Commissioner Marco Sefcovic said they were close to landing a trade deal with the US. He said the EU was spared the higher tariffs that other countries had been warned about.

– May have consequences for Norway

Minister of Trade and Industry Cecilie Myrseth (Labour Party) warns that the US's announced tariffs on EU goods could have consequences for Norwegian companies.

– High tariffs on goods from the EU to the US could indirectly affect Norwegian businesses, which are closely integrated into European value chains, the Minister of Trade and Industry tells NTB.

Chief economist Harald Magnus Andreassen at Sparebank 1 believes that Trump's tariff measures could backfire on the US itself:

– This is hitting Americans the most, much more than others. Growth estimates for the US have been significantly revised down this year. So this is self-harm on the part of the US.

Danish Foreign Minister Lars Løkke Rasmussen calls the tariff pointless and short-sighted. He also says the EU is ready with countermeasures.

German reactions

The German Export Association BGA also believes that Trump's move is a negotiating tactic, but emphasizes that the EU must not allow itself to be overrun and instead seek a solution on equal terms. However, an agreement is important.

The BGA says global trade has been in chaos since Trump first announced high tariffs in April. The trade war with the rest of the world has disrupted supply chains, leading to uncertainty and a collapse in demand.

According to BGA, it is too early to see the full consequences of America's erratic trade policy, but makes it clear that the EU must become more independent of trade with the US in the future.

The United States is Germany's largest trading partner, but German exports to the United States have fallen 7.7 percent to their lowest level since 2022 after the trade unrest began. Not least, the American market is important for the automotive industry.

German economist Katherina Reiche says that tariffs on EU products will hit hard both in Europe and the United States, and that it is imperative to find a pragmatic solution quickly.

Mexico responds

On Saturday, Trump also published a similar letter to Mexican President Claudia Sheinbaum, in which their goods are also subject to a 30 percent tariff.

In his letter to Mexico, he acknowledged that the country has helped reduce the flow of migrants and fentanyl into the United States. But he says not enough has been done to stop drug trafficking and drug cartels.

Mexico calls the tariff unfair, while the country's finance ministry says it is still working to find an alternative to the 30 percent tariff by August 1.

Mexico is perhaps the country hardest hit by Trump's tariffs, since 80 percent of the country's exports go to the United States.

Letters to many countries

Trump has sent tariff letters to over 20 countries. The different rates have varied in strength. For example, Brazil has been notified of a 50 percent tariff on goods it sells to the United States, while Canada has received a letter of a 35 percent tariff.

When the US president imposed the original tariffs on April 2 earlier this year, EU goods were taxed at 20 percent, while goods from Norway were taxed at 15 percent.

As stock markets plunged after the announcements, Trump suspended the tariffs for 90 days and promised negotiations. So far, he has only managed to secure limited deals with three countries – the United Kingdom, China and Vietnam.

The tariff break for most countries, with a base tariff of 10 percent, will remain in effect until August 1. Trump has, through his tariff letters, urged countries and companies to move production to the United States, as this, according to him, will allow them to avoid tariffs.

With the high tariffs, he is fulfilling promises from the election campaign when he claimed that the United States had been exploited by other countries for decades.

However, transferring production to the US is easier said than done. It can take years to build new factories, and in many cases large subsidies are needed to build infrastructure. For companies, higher wages in the US will also weigh heavily.