A growing tariff conflict between the US and EU is putting $9.5 trillion of annual business at risk, according to a report from the American Chamber of Commerce to the EU (AmCham). The organization’s Transatlantic Economy report highlights the deepening relationship between the two economies, with goods and services trade reaching $2 trillion in 2024.
The US has imposed tariffs on steel and aluminum, while the EU plans retaliation. President Donald Trump has threatened 200% tariffs on EU wine and spirits. AmCham warns that these actions could damage the close ties between US and European companies, which have interlinking value chains to be globally competitive.
The report suggests that trade is only part of transatlantic commercial activity and points to investment as a key benchmark. Contrary to conventional wisdom, most US-EU investments flow within the region rather than to lower-cost emerging markets. Intra-firm trade makes up about 90% of Ireland’s and 60% of Germany’s trade.
AmCham warns that ripple effects from the trade conflict could damage these close ties, including data flows or energy, as Europe relies on US LNG imports. The report’s lead author, Daniel Hamilton, says that isolated investments are unlikely to be made due to the interconnected nature of global value chains.
The US-EU relationship is seen as a critical component of economic stability and growth. As such, it’s essential for both parties to address the trade tensions before they have far-reaching consequences.
Source: https://www.reuters.com/business/us-eu-tariff-clash-imperils-95-trillion-business-amcham-warns-2025-03-17