Given the EU's projected economic growth of 0.9% for the year, the imposition of these tariffs could potentially push the EU into recession.

This 90-day period allows the EU to prepare for potential higher tariffs if a trade agreement is not reached, according to a senior EU official.

On April 11, 2025, European Union finance ministers convened to strategize on negotiating a trade deal with the U.S. after a 90-day postponement of higher tariffs.

The European Commission is spearheading negotiations with the U.S. to avoid increased tariffs, with aspirations for a zero-tariff agreement on all industrial goods.

Current U.S. tariffs of 25% are impacting key sectors such as steel, aluminum, and automobiles, with the European Central Bank projecting that these tariffs could reduce EU GDP by 0.5% to 1.0%.

Should negotiations fail, the 27 EU member states will need to coordinate their responses to support the most affected industries, including steel, aluminum, cars, timber, and pharmaceuticals.

Ministers have emphasized the necessity of coordinated support for affected industries to prevent unequal competition within the EU, as member states possess varying fiscal capacities.

To bolster its position, the EU aims to leverage its single market of 450 million consumers by reducing internal regulatory barriers, which the International Monetary Fund estimates are equivalent to a 44% tariff on goods and 110% on services.

In a related development, U.S. President Donald Trump announced the suspension of 20% reciprocal tariffs on Europe, initially set to take effect on April 2, 2025, although a 10% tariff remains in place globally.