The US president has vowed to impose 25% levies on all imports from the bloc

US President Donald Trump's plan to impose sweeping tariffs on EU imports could deal a significant blow to the bloc's economic development, according to Bloomberg.

Trump has stepped up his trade crackdown on the EU, recently claiming the bloc was created to "screw" the US and vowing 25% tariffs on "cars and all other things." As part of the push, he has slapped a 25% levy on EU steel and aluminum shipments starting March 4.

A blanket tariff is "no joke," Bloomberg columnist Lionel Laurent wrote on Monday, estimating that it could put 1.5% of EU gross domestic product at risk.

In a worst-case scenario, the levies could cost the European steel sector 12,000 jobs and force automakers to shift production to the US, according to Bloomberg Intelligence analysts.

The report cited European steel producing giant ArcelorMittal SA, which is scaling back jobs and operations at home amid the EU's "existential" crisis of soaring energy costs and cheap Asian imports. The company has warned that all its European plants face potential closure. Its German rival Thyssenkrupp AG's steel unit reportedly plans to slash 40% of its workforce in the coming years.

The report noted that while Trump's "anti-EU hostility has intensified," the European economy is weaker than it was during his first term, particularly at its core, where France and Germany lag in growth, while the US remains comparatively stronger "as the global engine of demand."

The trade row between the US and the EU has escalated since Trump announced plans to introduce a wide range of import duties in an effort to tackle what he describes as a trade imbalance. Last week during a cabinet meeting, Trump reiterated that his administration plans to impose tariffs on EU imports "very soon." The EU said it was prepared for broad retaliation in response.

The proposed tariffs are expected to impact a wide range of European goods, with the automobile industry likely to be among the hardest hit. European car manufacturers, such as Volkswagen and Mercedes-Benz, could face significant challenges in the US market.

The struggles in Germany's auto sector have raised concerns about the stability of the EU's largest manufacturing economy, with rising costs forcing shutdowns, including at major players like VW.

In an article for Financial Times this month, former European Central Bank President Mario Draghi urged the EU to address trade barriers between member states, which he described as "far more damaging for growth than any tariffs the US might impose."

(RT.com)