The Certainty Deficit: How US Trade Policy is Paralyzing European Businesses

A massive “certainty deficit” is paralyzing European businesses as they try to navigate an unpredictable US trade policy on steel tariffs. The constant threat of an expanding list of “derivative” goods is making long-term planning, investment, and supply chain management nearly impossible, according to industry leaders.
The problem is not just the existence of the tariffs, but their ever-changing scope. The US has already added 407 categories of manufactured goods to the list, and a new consultation, ending September 29, is expected to add more. The potential for the list to be reviewed three times a year creates a state of permanent instability.
“The issue is if we still have a number of things that are not clear… it is very difficult to claim we have certainty,” explained Luisa Santos of BusinessEurope. This lack of a stable, predictable framework is more damaging to business operations than a consistent, albeit high, tariff rate.
This uncertainty forces businesses into inefficient and costly behavior. A German motorcycle factory, for example, over-reports its steel content and pays extra duties. This is not a mistake, but a calculated business decision to mitigate the much larger risk of a 200% penalty in an ambiguous regulatory environment.
Closing this “certainty deficit” is now the top priority for European industry groups. They are demanding clarity from Washington and protective measures from Brussels. Without a return to a predictable trading environment, they warn that the paralysis affecting businesses will lead to lost investment, lost growth, and lost jobs.