Will a U.S.–EU Trade War Break the Western Alliance?
What began as a trade dispute now threatens to unravel the transatlantic alliance. Rising tariffs and political friction between the U.S. and EU could weaken NATO unity, disrupt global markets, and shift the geopolitical balance—just as rivals like China and Russia watch closely.
Trump's Trade Aggression: the Risk of Global Destabilization
Since taking office again in 2025 Donald Trump launched a large-scale trade offensive: tariffs on Chinese goods reached 125%, and according to CNBC estimates, even 145%, taking into account the previously imposed import duties on fentanyl.
However, despite the harsh rhetoric, Trump temporarily eased tariff pressure on dozens of other countries by giving a 90-day “pause” and reducing duties to 10%. The reason is the panic in the markets, the fall of stocks and bonds, and direct warnings from the business elite about the risk of a recession similar to 2008. The problem is that more than half of US imports are components needed for domestic production. Rising prices and supply chain disruptions are already hitting American businesses.
Will the New US Tariff Policy Be the Beginning of a Large-scale Trade War with the EU?
President Donald Trump's recent announcement of higher tariffs on imports from the EU - including steel, aluminum, cars, and luxury goods - has raised fears of a large-scale trade war. Historically, duties are taxes that governments impose on imported goods to protect domestic producers. But experts warn that such measures could trigger a mirror response, leading to a costly economic conflict.
The EU has already threatened retaliatory measures, including against such iconic American brands as Harley-Davidson motorcycles, Levi's jeans, and bourbon. Economists believe that such an escalation could seriously undermine international trade. If Brussels responds in kind, it will jeopardize not only economic growth but also the political solidarity on which NATO is based.
The EU exports more than $500 billion worth of products to the US annually, and the most vulnerable industries are the automotive industry (especially Germany), the chemical industry (Belgium, the Netherlands), and the agricultural sector (France, Italy). Retaliatory tariffs could threaten hundreds of thousands of jobs.
How Deep Can the Transatlantic Alliance Be Broken?
The Transatlantic alliance, primarily through NATO, the North Atlantic Alliance, has long been the foundation of Western security, a guarantor of stability and deterrence, especially during the Cold War. But a major trade conflict risks weakening this unity, undermining both economic and political ties.
NATO has traditionally relied on solidarity between the United States and its European allies. If economic confrontation leads to a decrease in trust or cooperation, the Alliance's effectiveness could suffer. This is especially dangerous at a time when security threats-from terrorism to cyberattacks-are becoming more complex and global.
Who will Benefit from Weakened US-EU Cooperation?
The immediate beneficiaries of strained transatlantic relations may be the West's geopolitical rivals, primarily China and Russia. China, as a rising economic superpower, can take advantage of the situation by strengthening its influence in Europe through initiatives such as Belt and Road.
The United States risks underestimating China, which has already overtaken America in a number of key indicators: industrial production, hypersonic technology, and the number of scientific publications and patents. Even with the economic slowdown, China will remain a strategically powerful player capable of challenging the United States. Beijing produces more than 60% of the world's electric vehicles, 80% of lithium-ion batteries, has the largest navy, and is leading the way in commercializing the 4th generation of nuclear power. All this is the result of unprecedentedly rapid modernization.
Russia, in turn, is likely to seek to expand its political influence in Eastern Europe, where the unity of the EU and NATO is crucial to deterring Russian aggression. A weakened West is in line with Moscow's long-term strategic interests.
So while Washington is quarreling with Brussels, Beijing and Moscow are not wasting time. Not only did China not back down, but on the contrary, it retaliated by imposing mirror duties and restrictions on the export of critical minerals. Moreover, its economic influence in Europe, Asia, Africa, and Latin America continues to grow. Russia, on the other hand, is trying to use a possible split in the West to strengthen its influence in Eastern Europe and the Balkans.
How will a Potential Conflict Affect Global Markets, Supply Chains, and Third-country Economies?
A prolonged conflict between Washington and Brussels could have serious consequences for world markets and global supply chains. Companies around the world will face higher costs, production delays, and regulatory uncertainty, which will ultimately lead to higher prices for consumers.
Developing countries and economies that are heavily dependent on exports to the US and EU could be hit hard. Declining demand, falling export revenues, and economic instability are likely consequences for countries such as Mexico, Brazil, or India.
In addition, the US attempt to “reset” global trade without proper preparation could cause a domino effect. As critics of the Trump administration point out, economic escalation without a parallel strengthening of domestic production is a path to self-harm. The risk of an “economic Vietnam” is quite real.
What Place Can Ukraine Take in the New Architecture of Alliances?
Ukraine, located at a strategic crossroads between Europe and Russia, finds itself in an extremely vulnerable, but also potentially advantageous position in the new global realignment. A split in the transatlantic camp could make it harder for the West to support Ukraine, which is critical against the backdrop of Russian aggression.
However, with the right strategy, Ukraine can take advantage of the situation by deepening bilateral economic and security ties with individual European states that are seeking new partnerships. By implementing reforms, adapting to European standards, and striving to integrate into the Western world, Ukraine can make itself a valuable partner in the new system of alliances.
In addition, Ukraine can become part of a new “architecture of large-scale cooperation” by participating in projects of joint production of defense equipment, digital technologies, and hydrogen energy. Cooperation with Poland, Lithuania, South Korea, or Japan could become a new source of growth.
What's Next: How to Avoid a Gap?
The only way to avoid a full-scale conflict is through diplomacy and compromise. Politicians on both sides of the Atlantic should remember the historical value of transatlantic unity. Trade disputes are not uncommon, but letting them destroy fundamental security and economic alliances is a risk the world cannot afford.
Finding common solutions, coordinating actions and updating the format of cooperation is the way forward. Right now, when threats are multiplying, solidarity and strategic thinking are needed more than ever.
The coming months will test the political wisdom of Western leaders. And for citizens, it will be a time of realization that even seemingly invisible economic decisions can change the balance of power in the world.
Returning to the logic of national protectionism without building a coalition is a path to strategic defeat. As the experience of Britain in the twentieth century shows, no country, even a great one, can withstand a long-term rivalry with a giant with a production and demographic scale.
The United States no longer has a monopoly on power. Its advantage lies in its alliance with others. But this alliance should be not just a defense alliance, but an economic and technological one. And here Ukraine can be not only a beneficiary but also a co-creator of the new architecture of the West.
In the world of scale, it is not the largest that wins, but the one who unites others. And this is what will be decisive in the twenty-first century.
Ihor Petrenko, founder of the “United Ukraine” Think Tank, Doctor of Political Sciences