Tensions between Washington and Brussels escalated Friday after former President Donald Trump threatened to impose a sweeping 50% tariff on all European Union goods entering the United States. The move drew swift condemnation from European officials, who warned of potential retaliation and emphasized the need for respectful negotiations.

EU Trade Commissioner Maros Sefcovic urged calm following a call with U.S. Trade Representative Jamieson Greer and Commerce Secretary Howard Lutnick. “The EU is fully engaged and committed to securing a fair deal. But trade must be guided by mutual respect — not ultimatums,” he said.

Trump, writing on Truth Social, slammed the pace of negotiations: “Our discussions with them are going nowhere. I’m not looking for a deal — we’ve set the deal.” Later, speaking to reporters, he confirmed the tariffs could take effect June 1 unless major EU-based companies made “big investments” in U.S. operations. He added that U.S.-made products would be exempt.

The EU exported over $600 billion in goods to the U.S. last year, making it one of America’s largest trading partners. The prospect of a tariff hike prompted alarm across Europe.

Irish Prime Minister Micheál Martin said talks — not threats — were the only sustainable path forward. France’s Foreign Minister Laurent Saint-Martin echoed that sentiment, warning, “We want de-escalation, but the EU is prepared to respond.”

Germany’s Economy Minister Katherina Reiche said a diplomatic solution must be found to avoid disruption to key industries. Dutch Prime Minister Dick Schoof stressed the importance of EU unity and historical precedent for volatile trade disputes with Washington.

Trump, who has long criticized what he calls the EU’s “unfair” trade practices, has zeroed in on European auto imports and agriculture regulations. He also threatened to slap a 25% tariff on iPhones not produced in the U.S., later expanding the threat to include all smartphones.

Markets reacted sharply to the developments. The S&P 500 slipped 0.7%, while Germany’s DAX and France’s CAC 40 each fell by more than 1.5%.

Trade talks had been proceeding under a fragile truce after Trump agreed to reduce a previous 20% tariff threat to 10%, setting a July 8 deadline to finalize a broader agreement. With the clock ticking and rhetoric intensifying, the risk of a full-scale transatlantic trade war now looms large.