The European Union should not respond to U.S. President Donald Trump's reciprocal tariffs with exactly the same counter-measures as it would impact EU consumers, French Finance Minister Eric Lombard said on Friday.
Trump on Wednesday unveiled sweeping tariffs on dozens of countries with a baseline rate of 10% on all imports to the United States. His move prompted global stock markets to plunge amid fears of price hikes, while countries around the world prepare retaliatory measures against the United States.
"We are working on a package of responses that can go well beyond tariffs, in order, once again, to bring the U.S. to the negotiating table and reach a fair agreement," Lombard said in an interview with broadcaster BFM TV.
The EU is divided on how best to respond to Trump's tariffs, including on use of its 'Anti-Coercion Instrument', which allows the bloc to retaliate against third countries that put economic pressure on EU members to change their policies.
Countries that are cautious about retaliating and thereby raising the stakes in the standoff with the U.S. include Ireland, Italy, Poland and the Scandanavian nations.
Trump hit EU imports into the U.S. with an across-the-board 20% duty.
"If we do like the United States, if we apply tariffs to all American imports, we will also have a negative effect in Europe, meaning that we too will experience increasing inflation and decline," Lombard said.
French President Emmanuel Macron on Thursday suggested European companies should suspend invesments with the United States until "things are clarified" with Washington.
Lombard said that companies are free to decide whether they will suspend investments in the United States.
"We are appealing to patriotism because we are in a moment of confrontation between the major (trade) blocs on the planet. Europe has all the means to be at their level, but it requires effort," Lombard added.
