Department of Research, Studies and International News 11-02-2025

The European Union stands ready to retaliate “within an hour” against any United States tariffs imposed on the bloc, Germany’s Chancellor Olaf Scholz declared during a pre-election debate with conservative rival Friedrich Merz.

When the moderator of the televised face-off inquired whether the EU maintained a “list of cruelties” for potential retaliation against US tariffs, Scholz, who is trailing significantly behind Merz in polls ahead of Germany’s Feb 23 election, responded: “Yes, to phrase it in the most cautious diplomatic way. We, as the European Union, can act within an hour.”

Germany’s trade matters fall under EU jurisdiction, with policy decisions managed by the European Commission in Brussels, as is the case with all EU member states.

Scholz’s warning comes amid growing transatlantic tensions as US President Donald Trump’s administration considers new tariffs on European goods, reviving trade disputes that marked his first presidency from 2017 to 2021.

Since being elected in November, Trump has consistently issued warnings about implementing tariffs against primary trading partners, claiming they exploit US

economic success.

During Trump’s previous term, the EU retaliated against US tariffs with countermeasures on US products, including bourbon, motorcycles, and agricultural goods.

The European Commission stated on Monday it would protect EU interests against any “unlawful and economically counterproductive” US tariffs on aluminum and steel, citing the deeply integrated production chains between the two economies.

“The EU sees no justification for the imposition of tariffs on its exports. We will react to protect the interests of European businesses, workers, and consumers from unjustified measures,” the statement read.

In their debate broadcast live on public channels ARD and ZDF on Sunday, Merz characterized Scholz as a “ditherer” who had led Germany into economic crisis, while the Social Democrat positioned himself as an experienced leader who commanded the details, reported Reuters.

Discussion of Trump and the far-right Alternative for Germany, or AfD, party, which has received an endorsement from Trump ally Elon Musk, whose global Tesla business includes major manufacturing operations in Germany, loomed over the debate.

Merz showed hesitation about increasing taxes or taking on debt to meet NATO’s defense spending target of 2 percent of gross domestic product, which falls well below Trump’s 5-percent demand.

After Scholz indicated this would be insufficient, Merz suggested he might be willing to consider abandoning Germany’s symbolic spending limit, despite his campaign promise to maintain the constitutional debt brake.

The two sparred over the AfD issue, with Scholz questioning Merz’s commitment to exclude the party from government. Merz dismissed any possibility of cooperation, instead accusing Scholz’s “left-wing” policies of driving the far-right party’s surge to second place in polling.

The controversy over the far-right party stems from events in late January when Merz broke a long-standing taboo by accepting AfD support for immigration legislation in Germany’s parliament, the Bundestag.

While his initial motion passed with far-right backing, a subsequent attempt to enact binding legislation failed narrowly. His unprecedented cooperation with the AfD sparked condemnation and nationwide street protests, including rare public criticism from former chancellor Angela Merkel.