Summary
President Donald Trump threatened to impose new tariffs on eight European countries but withdrew the threat after a meeting with NATO's Secretary General. This pattern of making aggressive trade threats followed by quick retreats has been noted as happening more rapidly in recent years. The European Union has developed a new tool, the Anti-Coercion Instrument, to counter such economic threats.
Key Facts
- President Trump threatened to impose 10–25 percent tariffs on eight European allies.
- The tariffs were meant to press Europe for concessions related to Greenland.
- After a meeting with NATO Secretary General Mark Rutte, Trump withdrew the tariffs.
- European lawmakers had paused a U.S. trade deal at the time.
- Markets reacted positively to Trump's retreat, a pattern described as "Trump Always Chickens Out" (TACO).
- The EU has introduced the Anti-Coercion Instrument to counteract economic coercion.
- Treasury Secretary Scott Bessent defended Trump's tariff strategies as a deterrence tool.
- The strategy aims to use economic power to prevent conflicts without military action.
