EU to suspend planned counter-tariffs on $109 billion of U.S. goods

The European Union will suspend retaliatory tariffs on $109 billion of U.S. goods for another six months after U.S. President Donald Trump backed down from his threat to impose levies on some EU countries that opposed his push to annex Greenland.

The European Commission, the EU’s executive arm that handles trade matters for the bloc, is planning to table a proposal to extend the suspension of the countermeasures, which is due to expire Feb. 7, according to spokesperson Olof Gill.

“We achieved our objective through diplomatic and political means which will always be our preference rather than going down a spiral of measures and countermeasures,” Gill told reporters in Brussels Friday. The suspension will last for six months, though the countermeasures can be reactivated at any point should they be needed, he said.

Tensions over Trump’s aggressive approach to Greenland had prompted EU leaders to also float using their most powerful trade tool, the anti-coercion instrument, against the U.S., while the European Parliament put ratification of the bloc’s trade deal with America on hold.

The parliament is now expected to unblock the accord in the wake of Trump’s reversal, the body’s president, Roberta Metsola, told reporters ahead of a summit of EU leaders on Thursday.

Trump had threatened a 10% tariff on goods from eight European countries starting Feb. 1, rising to 25% in June, unless there was a deal for the “purchase of Greenland.” That was put off following the announcement of a deal by the U.S. president after a meeting with NATO Secretary General Mark Rutte in Davos.

The planned retaliatory tariffs on U.S. products like Boeing Co. aircraft, U.S.-made cars and bourbon had previously been agreed by the EU but their implementation was suspended amid negotiations over the EU-U.S. trade agreement, reached by Trump and Commission President Ursula von der Leyen in Scotland last year.