US‑EU Trade War Heats Up: The EU Hits Back with Its Nuclear Option

The US-EU trade war just took a serious turn. In this episode, Neil McCoy-Ward breaks down the EU’s unprecedented move: activating the Anti-Coercion Instrument (ACI) to launch a €93 billion counterstrike against potential US tariffs. From digital giants like Netflix and TikTok to energy, agriculture, and even nuclear deployments, this isn’t just economic policy, it’s geopolitical warfare. Get the facts, dates, and what it all means before August 7.

Transcript

Okay, ladies and gents, I hope you are sitting down for this one because it is about to get real between the US and the EU. I honestly couldn't even believe some of the stories I was reading today. I've put a little report together for you to show you the impact of this as well. But Ursula Vonda, the uh the snake in the grass as we as we call her, or the sly fox, whichever you prefer. Oh my goodness. What has been going on behind closed doors is quite unbelievable. So, we know about all the sort of deals they were doing with China to sort of bypass the US and try and reduce the US's impact. Um, and at the same time, Ursula's sort of smiling and talking to President Trump. Oh yes, we're we're looking forward to doing these deals and stuff. So sneaky all the things behind closed doors. Then they went to the WTO and said that what President Trump was doing was illegal. And then they went for the Council of Human Rights and all this other stuff to say was against people's human rights, these tariffs and everything else.

Now they have just passed something which has never been used before. This is one of the most severe things that European Union can use against any non-member state. So these are anti-coercion instruments. So they're now classifying the US. I'm not sure if I should use the the words because it might be too strong. But what they they're basically classing them as a foreign actor now trying to illegally attack the European Union via economic warfare. Yeah, that's why I said sit down for this one. So, this is about to get absolutely crazy. I got a couple of articles I want to show you which are very soft actually and then we'll go through the harder stuff on my report here. So let's get let's get into the first one. So this is the this is out of CNBC. Europe's trade bazooka could be a last resort against Trump's tariffs. So they are now using these anti-coercion instruments to deter President Trump. So, it's a threat basically to stop him putting the 30% tariffs on.

Because you got to bear in mind, if you actually look at this properly, this wouldn't just be against the US and classifying them as this foreign actor that's doing this attack against the Euro zone. It's a lot it's is a lot more serious than that. Has a lot of wider implications. If they pass this through the courts and and all the member states vote on it, they could then put pressure on their trading partners to classify the US as the same thing. It would basically be like putting sanctions on the United States. They are playing with fire right now. Seriously. And I just don't think this is going to work. They they I mean it it didn't even work with Russia. If you think about what the EU did, Russia just bypassed all of the sanctions. They still sold all of their oil. They still sell all of their energy and do the things that they were going to do. So why they think that it's going to work with President Trump and the United States, which is the powerhouse of the world, I'm not exactly sure. But this is basically what we're looking at now. It's it's not quite on par with sanctions, but it's not far off.

So, a me a number of the EU states. So, who led this? It was Germany and France. It only says Germany here, but I've read through the reports and it is France as well that led this. Um, they always they always use weird pictures, by the way, of of President Trump. They always use the worst possible poses they possibly can. So, they've characterized this as a nuclear option, and they're using this um word quite a lot at the moment, the nuclear option. So, the European um Council data shows trade between the EU and US amounted to 1.68 trillion or almost €2 trillion last year. But while the EU ran a trade surplus in goods, it recorded a deficit in services. Now, I've got to get on to the services in a moment because when you hear what the EU is about to do to US services, uh my jaw actually dropped when I read through this. So, get ready for this one.

Do you like online streaming platforms? Do you like using a smartphone with your apps and things? Well, if they push this through, you might not be able to have access to US tech firms or they're going to put massive fines and penalties on them. I told you this is a crazy one. I mean, usually my videos are are crazy ones, but this is an even more crazy. By the way, if you're not subscribed to the channel, make sure to subscribe as we continue on here. This is just this is getting getting wild here. Okay, so they're going to hit them with Okay, so it's about 50 billion euros a year when you look at all the tech services in Europe. Um, and remember they tried to put all these tariffs on and it didn't quite work. Anyway, uh Trump's 30% tariff is looming and the EU has been considering its options including counter tariffs targeting US imports and the ACI which we'll talk about in a moment.

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Okay, let's before the report then. So e pretty much everyone is running with this story and it depends how biased they are as to um the US or EU. So this is out of Politico and it says talking about how the EU is readying this single $93 billion US trade retaliation package. So it's basically like a kind of like a sanction of almost $100 billion. So what they've done, this is why it's so serious and I think President Trump is going to flip when he sees it. They haven't just done this one package. They've actually combined two packages together. And now the first one's already gone through. They did that very quickly and the second one are about to vote on. So, there's two packages of retaliation measures and they're saying they're going to they're going to use this if President Trump doesn't back down. He's not going to back down. So, let's just assume this is going to go ahead.

This is what Ursula had to say. To make our measures clear, our counter measures simple and strong, we will merge list one and two into a single list. The first list is currently paused until August 6th and the second waits a vote by the EU's 27 member countries. However, Ursula's pushing it through. And look, she didn't get voted out for all of the stuff that she did. So, I'm pretty sure she's going to get this passed. This will be almost 100 billion of of uh it doesn't say, it just says this will affect this is like a sanction on hundred billion dollars worth of US goods. And this is uh this is the commission they're looking to pass it.

The moves comes as negotiations have faltered in recent weeks after President Trump threatened with a 30% tariff. Now one thing that did break overnight was that Trump has announced a deal with Japan and that's a 15% tariff. So that's actually come out.

Okay, let's get on to this then. This is what I put together for you made a report. So the first thing is what is the ACI then? What what is the anti-corruption in uh sorry anti-coercion instrument? So this was a legal framework regulation EU 2023/2675 if you want the specifics. It came in on the 27th of December 2023. I'm not joking. They passed this 2 days after Christmas. There was no one there, so they just passed it. And it empowers the EU to determine when a non-EU country is using what they consider to be economic coercion or a um economic warfare. So they class it as one stage of warfare. They don't see it as conventional warfare, but they see it one level below conventional. That's...

Can you see how crazy that is? Actually, I I didn't even think this through properly, but that is one level less than the US putting tanks on EU soil and dropping bombs. So, that's what they are classing this as. I mean, this is how desperate I think Ursula has become. So, the main goal is that it acts as a deterrent without firing any shots as it were. So they say that this will act as a deterrent and anyone is basically going to back down when they get hit with this because it's so severe. I mean the fact we're we're here shows that they have got no other options left on the table.

So how does it work? Stage one is an examination. This was passed. It does meet the criteria. Of course it does. Uh number two is a determination. This was also passed. This was the council that have passed this. Number three is a consultation. This is where the EU engages in talks with the instigator. I love this word instigator. Uh stage four is the counter measures. So this is where if the talks fail, they then do these counter measures. Then uh this is tariffs, quotas, uh controls, public procurement, curbs on services. So they say digital services first. So they put these these sort of curbs on the digital services of the US in order to put pressure on President Trump.

Um they then go from here. Okay, another one they've approved so far $21 billion in these measures and they've proposed $72 billion more. So this is what they're just about to vote on. And they call this the nuclear option against the United States, who they say is um instigating economic warfare against the people of the European Union. Again, read into that what you will. If you're in the EU, you you might say, "Yeah, yeah, yeah, I I I can't believe they're doing warfare against me and my family." Not really. What the US is trying to do is balance the trade. And if you read into all the emotional stuff, don't do that. You'll probably say, "Oh, yeah. I can see why they're trying to balance the trade because they said that people feel upset about about this in Europe." Well, again, stop reading into emotions and start looking at data, facts, and statistics.

When you do that, you will start to see the world as it really is. But if you were always looking at the emotion and the headlines and what the media is trying to show you, you you're pretty much screwed because you you you'll never get it as it were. Sorry, I'm a bit strong on that one.

Um, so what else then? The ACI versus traditional retaliation then. So scope traditional would be goods only. Coercion would be goods, services, investment. So actually blocking investment as well or even seizing this would be a worst case scenario seizing investment. I don't know if that would mean say if you're an American, you've got investments into Europe. I don't know if it means it would do that. But honestly with how desperate they're getting, it wouldn't put I wouldn't put it past them. That's what happened with Russian citizens. They uh had sanctions against them. So their assets were were confiscated. So I don't know exactly how far this will go at this point.

So the next thing I I I sort of looked into was the question I had in my mind was what could the economic impact be if they do use this against the US. So I wanted to know from both sides. So on the US particularly them this is the research I've done. Number one would be the exporters would be hit hard very quickly. This would be 100 billion plus. It wouldn't just be the 93 billion. It would be 100 plus on US exports. Agriculture I would say will be hit the hardest. That's soy corn. Secondly would be L energy. So LNG tech anything tech if you've got investments in tech and they operate in the EU that could be hit. Chips cloud services the auto industry would be hit very hard. uh Boeing, Tesla, Apple. Watch your shares if you have these these stocks. Also, Cargill, ADM. These were the five I identified that could be hit the hardest by these sanctions. I'm going to just use the words, let's just call it sanctions. Let's that sounds better.

Uh number two, investment chilling. Then EU could restrict US investment access particularly in finance, digital services and infrastructure. So be careful there. And US firms could lose EU market access. So might not be able to get any access to the EU market.

Number three would be all around the financial market. Uh this could again this I'm sort of on the fence with this cuz I started going through it all and it got very very complex. But my I sort of got to the point where it could push up the dollar. That's what it could do as opposed to drop the dollar. Higher costs for US consumers and manufacturers would be the other one because of the retaliatory tariffs. You could even see inflation tick up a little bit in the US, but I think they would just reshore a lot of the the manufacturing and some of the other things. Yeah, it takes a long time to set it all up and the factories, but I think that's probably what we'd see. We'd see reshoring. So yeah, you could see a little bit more inflation, but I think people just move to other products and services that were US based.

Now, what about on the European Union then? Well, you've also got to think that what they do to the US, there'd be a retaliation, but also there would be a cost of losing these services. So, number one would be the cost of losing US market access. The US is the EU's largest market exporter. Remember that. So, it's 500 billion a year. That would hit German um auto industry the hardest. French luxury, we covered that in another video. And the tech firms as well. These would be hit hard. Supply chain disruption. US companies are deeply embedded in the EU supply chain. That's digital infrastructure, finance, and pharmaceuticals. So, that's the other one is farmer.

Uh number three, political division. if they go down this road, they could try to put pressure onto other countries to put pressure on the US. So that could happen. And then there's an energy risk as well. The US has become a major LNG supplier since they cut off Russia. So you could see higher energy costs because they'd have to get LNG from elsewhere.

So they would be the main ones. Uh I did a bit more research for you here. But I think the main thing you'd want to know is top five sectors then. So who would feel the hardest? Uh for the US it would be agriculture, automotive, digital services and big tech, aerospace and energy. They would be your top five for the US. For the EU then most strategic EU targets I think they would target procurement exclusions. So banning the the US restrictions on the digital stuff, regulation delays, IP enforcement slowdowns, and sector specific tariffs. I mean, I could go through the whole research I did for you, but that I think is more than uh enough to cover most of it.

Let me just see if there was anything else I wanted to cover on the other side then. I think Oh yeah, we've got we've got this one very very quickly. really quickly. The US has just transferred um nuclear weapons to the UK for the first time in over 15 years. Russia as a result, here it is, says it's monitoring these new positions of the nuclear weapons in the UK. They are not happy at all. But talking of nuclear, I think we've used the word 10 times today. US nuclear weapons agency was breached in the Microsoft SharePoint hack. This is not good at all. It affects all sorts of all sorts of sectors. It's energy as well and they got access to and I was looking into the report who they say did the hack. And again, you never actually know. It's almost impossible to know. But what they are saying is that they believe it was China that did the hack. Again, take that with a pinch of salt, a grain of salt or depend on your country's term there. And whether it was China or not, I'm not sure, but that's what they are saying. They're saying China did it. And they've got all of this access now, all of this information on US nukes and all the sites and everything. Uh, thanks again to Microsoft SharePoint. That's the second major hack that they have had. Now, that I think is the main things I wanted to mention here.

Just a reminder, check out on the uh summer sale if you haven't already. see what courses are available. There might be some on there that you like the look of. There's all sorts on there. You don't have to get the the whole bundle. You can get some of the smaller courses. We have got a few on sale. Uh that is it for today. Thank you so much for being a Hold on. Let me get it on. There we go. Subscriber here. Really appreciate you. Take care. God bless you. And I'll see you on Friday for a walk and talk. Please cross your fingers and pray we have some good weather so we can have a nice beautiful walk and talk. All right, take care. Bye for now.