BERLIN, GERMANY – FEBRUARY 24: Robert Habeck, chancellor candidate of the German Greens Party, speaks to the media the day after German parliamentary elections on February 24, 2025 in Berlin, Germany. The Greens came in fourth place with 11.6% of the vote, down 2.9% from the previous election. (Photo by Sean Gallup/Getty Images)
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U.S. President Donald Trump will “buckle under pressure” and alter his tariff policies if Europe bands together, acting German economy minister Robert Habeck said Thursday.
“That is what I see, that Donald Trump will buckle under pressure, that he corrects his announcements under pressure, but the logical consequence is that he then also needs to feel the pressure,” he said during a press conference, according to a CNBC translation.
“And this pressure now needs to be unfolded, from Germany, from Europe in the alliance with other countries, and then we will see who is the stronger one in this arm wrestle,” Habeck said.
Allowing Trump to persist or trying to appease him would not be a successful strategy under any circumstances, he added, noting that the response should be a “day of determination.”
Strategically, the aim should be to avoid tariffs and a trade war, but the question was how to get there, the economy minister said.
Elsewhere, outgoing German Chancellor Olaf Scholz said he believed the latest tariff decisions by Trump were “fundamentally wrong,” according to a CNBC translation.
The measures are an attack on the global trade order and the “poorly thought through decisions” will result in suffering for the global economy, Scholz said. The U.S. administration is on a path that will only lead to losers, he added.
On Wednesday, Trump imposed 20% levies on the European Union, including on the bloc’s foremost economy Germany, as he signed a sweeping and aggressive “reciprocal tariff” policy.
Germany is widely regarded as one of the countries likely to be most impacted by Trump’s tariffs, given its heavy economic reliance on trade.
The U.S. is Germany’s most important trade partner ahead of China, with trade turnover — the sum of exports and imports — amounting to 252.8 billion euros ($278.7 billion) in 2024, according to German statistics office Destatis. Last year the U.S. was also the recipient of the biggest proportion of German exports.
The German index DAX was last down around 1.6% by 10:42 a.m. London time, while German government bonds were sharply lower. The yield on the 10-year Bund was last down by over 7 basis points to 2.648%, while the 2-year Bund yield tumbled more than 11 basis points to 1.93%.
Also responding to the White House developments, European Commission President Ursula von der Leyen said that the European Union was preparing measures to counter the latest tariffs from U.S. President Donald Trump, if negotiations fail.
“We are prepared to respond,” she said. “We are now preparing for further countermeasures, to protect our interests and our businesses if negotiations fail.”
But von der Leyen also called for a shift “from confrontation to negotiation” as she suggested it was not too late for talks between the EU and the U.S.