Explainer | What is the ‘trade bazooka’ the EU may use against Trump’s Greenland threats?
Under pressure from the US president, the bloc is considering measures that could inflict billions of dollars of losses on American firms
Rattled by US President Donald Trump’s threats over Greenland, the European Union is readying countermeasures against the United States.
As primarily a trading bloc, the EU’s toolkit is mostly financial instruments, from steep tariffs on US goods to the so-called trade bazooka touted by French President Emmanuel Macron.
So far, most of the 27 EU nations remain sceptical about using it.
What is the ‘trade bazooka’?
The term is shorthand for the bloc’s Anti-Coercion Instrument, which includes a raft of measures for blocking or restricting trade and investment from countries found to be putting undue pressure on EU member nations or corporations.
The measures could include curtailing the export and import of goods and services, barring countries or companies from EU public tenders, or limiting foreign direct investment.
In its most severe form, the bazooka would essentially close off access to the EU’s 450 million customer market.
The bazooka could inflict billions of dollars of losses on US companies and the American economy.