By John Revill

German Finance Minister and Vice Chancellor Lars Klingbeil sits in the German lower house of parliament Bundestag during the 2025 to 2029 budget session in Berlin, Germany, July 9, 2025. REUTERS

(Reuters) - German Finance Minister Lars Klingbeil said on Sunday the European Union must take "decisive" measures against the United States if tariff negotiations fail to cool an escalating global trade war.

President Donald Trump on Saturday threatened to impose a 30% tariff on imports from Mexico and the EU starting on August 1, after weeks of negotiations with the major U.S. trading partners failed to reach a comprehensive trade deal.

The threat has prompted a robust response from German politicians and business leaders.

"If a fair negotiated solution does not succeed, then we must take decisive countermeasures to protect jobs and companies in Europe," Klingbeil, who is also vice chancellor in Germany's ruling coalition, told German newspaper Sueddeutsche Zeitung.

"Our hand remains outstretched, but we will not go along with everything," he added.

Germany, Europe's biggest economy, is a big exporter to the United States, where it sells vehicles and automotive components, machinery and pharmaceuticals.

In 2024 it sold goods worth 161 billion euros ($188 billion) to the United States, running a trade surplus of nearly 70 billion euros, according to German government data.

Klingbeil said Trump's tariffs policy would only result in losers, and called for de-escalation in the row, which he said threatened the American economy at least as much as European companies.

"Nobody needs new threats or provocations now," Klingbeil said.

"Instead, we need the EU to continue serious and targeted negotiations with the USA. Europe remains united and determined: We want a fair deal."

Earlier on Sunday, Juergen Harder, deputy leader of Chancellor Friedrich Merz's conservative CDU/CSU parliamentary group in the Bundestag, said he was hopeful of further negotiations between the EU and Washington, with the higher tariffs postponed.

"I'm betting that at least a partial agreement and a further postponement will be reached before August 1," Hardt told Reuters.

"After all, high tariffs have to be paid by American citizens and companies and lead to higher prices and inflation in the U.S.," he said.

($1 = 0.8555 euros)

Reuters report

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