US-EU Trade Tensions Intensify Dramatically

Published on 5.24.25

  The ongoing trade dispute between the United States and the European Union has reached a critical juncture, with both sides dug in on their positions. The US has imposed a 10% tax on most of its trading partners, including the EU, causing economic uncertainty and job insecurity. US Trade Representative Robert Lighthizer has been pushing for Apple to relocate iPhone production from China to the US, but analysts argue that this is not feasible due to high labor costs, which could increase iPhone prices by 90%. This proposal has been met with skepticism by EU officials, who have threatened tariffs on $113 billion worth of US goods if negotiations fail to lower levies on European products. German Finance Minister Lars Klingbeil has urged swift resolution of the dispute, warning that prolonged tensions could harm economies worldwide. Meanwhile, US Treasury Secretary Steven Mnuchin expressed frustration with the EU's refusal to lower duties on European goods, threatening tariffs worth nearly $113 billion if no progress is made. The phone call between EU Trade Commissioner Maroš Šefčovič and US Trade Representative Robert Lighthizer may provide a glimmer of hope for resolving the dispute. However, the stakes are high, and both sides will need to make significant concessions to avoid a transatlantic trade war.

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