22 May 2025 – The European Union’s economy has been struggling with trade barriers in its single market for 30 years. Commission therefore presents new Single Market Strategy – but is it enough to make intra-European trade easier? Twelve states are suing the US government to repeal the Liberation Day tariffs. Does Brussels now want to introduce new tariffs to get a US trade deal?
EU struggling with internal trade barriers for 30 years
The economy in the European Union has been struggling with trade barriers in its “single market” for 30 years. As early as October 2024, the International Monetary Fund (IMF) found that trade costs between individual EU member states amounted to a significant ad valorem tariff of 44% for the average manufacturing industry (three times higher than between US states) and up to 110% in the services sector.
As we always say, if bureaucracy and trade barriers are already causing such serious tariffs and costs within the EU, one can well imagine the additional damage to the European economy caused by the unnecessary introduction and continuation of trade defense measures, EU Safeguard on steel or the Carbon Border Tax CBAM.
Commission presents new internal market strategy
Yesterday, Wednesday, the European Commission presented its “Strategy for making the Single Market simple, seamless and strong”, which is intended to help remove the hurdles in the EU Single Market. However, the strategy, which seems ambitious on paper at least, also depends centrally on the member states’ willingness to implement it and they have already done little to harmonize the single market over the last 30 years, especially with regard to small and medium-sized enterprises.
According to the IMF, simply reducing trade barriers to the level of the United States could help to increase intra-European productivity by at least 7%.
Liberation Day tariffs: states sue US government
Twelve US states have joined forces and sued the US government. They want the Liberation Day tariffs of April 2, 2025 to be lifted.
The states have now told a federal court that the Republican president misinterpreted a law called the International Emergency Economic Powers Act to justify the tariffs and considered it a “blank check” to regulate trade.
However, a decision from the court is not expected for weeks or months.
We would also welcome this courage at national EU level. Unfortunately, democracy seems to work better elsewhere than in the EU.
Does Brussels now want to introduce tariffs to get a US trade deal?
According to media reports, EU parliamentarian Bernd Lange (SPD, Germany), chairman of the European Parliament’s Committee on International Trade, has said that the European Union could impose tariffs on China in order to conclude a trade deal with the US government. He once again referred to alleged overcapacity in Chinese crude steel production.
Countering unjustified tariffs with unjustified tariffs?
It seems more than questionable to counter a trade deal to avoid US tariffs (which the EU considers unjustified) with the introduction of unjustified tariffs against other countries and important trading partners. But perhaps this is exactly what you get from communists when you recall Orson Wells and his novel Animal Farm: “All animals are equal, but some animals are more equal than others!”
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