Brussels was drawing up plans for a trade war with Donald Trump before his election victory.
Officials wargaming the threat of tariffs have a three-pronged strategy to buy off the US president.
The European Commission, which handles trade on behalf of its member states, has little choice but to strike back with its own tariffs if Mr Trump hits the EU with trade taxes.
EU governments demand nothing less. They do not want a trade war but will not stomach being strong armed, especially after Mr Trump hit European steel and aluminium in his first term.
Brussels has drawn up a hit list of US products, such as motorcycles and bourbon, for retaliatory tariffs.
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Officials have targeted products made in Republican-run states identified as vulnerable in 2026 midterm elections. Brussels hopes the congressmen will put Mr Trump under pressure to ditch the tariffs.
These surgical strikes will be swiftly followed with diplomatic efforts to de-escalate the conflict before it explodes into an economically damaging trade war during a cost of living crisis.
Brussels knows that Mr Trump’s problem with the EU is that it runs a large trade surplus with the US.
The US president suspects it uses the profits from this to fund generous social policies, while neglecting defence spending because it can rely on American strength to protect it.
EU leaders see Mr Trump as “transactional” and believe they can appease him.
Ursula von der Leyen, the European Commission president, has been at pains to point out that US businesses benefit from the trading relationship with the EU and has already floated the idea of buying more US liquefied natural gas (LNG).
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This would reduce the trade surplus and Russian LNG supplies to the EU, putting more economic pressure on Vladimir Putin. An LNG deal will provide a headline grabbing “win” for Mr Trump and boost EU energy security.
A similar gambit involving purchases of US soy beans helped prevent further tariffs, and gave Republicans a lift ahead of mid-terms, during Mr Trump’s first stint in the White House in 2018.
Then, Jean-Claude Juncker, an arch-dealmaker who forged a rapport with Mr Trump, was in charge as opposed to the staid Ms von der Leyen who had strong links with the Biden administration and Angela Merkel, the president’s other bête noire.
Defence spending
In Brussels on Monday, EU leaders will meet to discuss plans to boost defence spending, which include ideas such as joint procurement of arms.
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Emmanuel Macron may demand “buy European”, clauses but until continental arms manufacturing is ramped up this will mean EU countries buying more US arms and further reducing the $161.6 billion trade surplus.
On the campaign trail, Mr Trump was scathing in his criticism of European leaders for not doing enough to support Ukraine with weapons and aid.
The fear was that Mr Trump would simply cut off US support to Ukraine, but warnings that it could trigger a humiliation similar to Mr Biden’s shambolic withdrawal from Afghanistan seem to have had an effect.
Leaders and diplomats in the EU and Nato will flatter the president that they are ready and willing to line up behind the president as their leader in the stand-off with Russia.
“We have to negotiate with Trump,” said Petteri Orpo, Finland’s prime minister, in Brussels as he arrived at the EU meeting. “I’m not going to start a war. I want to start negotiations.”
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A string of European leaders, including Sir Keir Starmer, have loudly insisted that Mr Trump is “right” to say they should increase defence spending.
But securing “peace through strength” will only be possible if Mr Trump continues supplying Ukraine because without US support there is no reason for Russia to negotiate at all.
Brussels is banking on Mr Trump ending a trade war for new energy and arms deals and also the tempting glamour of a foreign policy coup.
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