Centre for European Reform

“There was this self-perception that the EU is a heavyweight that can go toe-to-toe with the US, and that has been the case in previous situations,” says Aslak Berg of the Centre for European Reform in London. “But the US has not chosen to play by the rules anymore.” By “the rules,” Mr Berg is referring to two tenets of the World Trade Organization. First, that tariffs should only be imposed under certain conditions. And second, that unless one nation has a free trade agreement with another, it has to treat all nations the same. These rules are aimed at maintaining predictability and fairness, and Mr. Trump has wholly ignored them.

Sander Tordoir, chief economist at the Centre for European Reform, and a former European Central Bank official, blames the poor trade terms secured by the EU on the unwillingness of Brussels to retaliate.“Brussels talked a big game about readiness for a trade war - but failed to load the retaliation gun,” he says.

“It's the kind of deal that a year ago would be unthinkable but, given the current circumstances, it's probably as good as it gets,” Aslak Berg, a research fellow at the Centre for European Reform, told The Parliament. He argued that most European exporters will remain competitive under a 15% tariff, meaning the outcome is “better than the worst-case scenario of a complete break.”

According to John Springford, an associate fellow at the London-based think-tank Centre for European Reform, Brexit has cost the state £40 billion (€46.1bn) since 2019.“The 2019-2024 parliament raised taxes by around £100 billion, and if we take the OBR’s 4% loss of productivity to be the true figure, £40 billion of those tax rises were needed because of EU withdrawal,” he wrote in a recent study.