The EU’s Commissioner for Trade Cecilia Malmström announced late Monday that the European Union has drawn up a draft list of items that could face stiff taxation following an announcement on March 2 by US President Donald J. Trump that he welcomed the prospect of a trade war with the EU and China  over steel and aluminium imports to the United States.

The move by Brussels is in-line with a statement by European Commission President Jean-Claude Juncker, who indicated on March 2 that the Commission was looking into a proposal on countermeasures compatible with World Trade Organisation (WTO) regulations that will act as a coordinated response to the steel and aluminium tariffs announced by Trump.

“The Commissioners will discuss our reaction. It will be swift, firm, and proportionate – based on three main criteria compatible with WTO rules,” said the Commission’s chief spokesman Margaritis Schinas in reference to a scheduled meeting on March 7. “Let me remind you the trade policy is not a zero-sum game. It is not about winners or losers, and we believe that trade can and should be win-win.”

Schinas reiterated Juncker’s point that the EU “cannot be expected to bury our heads in the sand when someone takes unilateral and unfair actions against us that put thousands of European jobs at risk”.

If Trump’s move on tariffs – which may also include EU-made automobiles – materialise in a way that affects European interests, the European Union will be compelled to enact equally punishing countermeasures, Schinas warned.

The Greek-born Schinas stressed that the root cause of problems in the steel and aluminium sectors is mainly due to global overcapacity and this can only be addressed at the source, by working with key countries involved,” adding that the EU is available to keep working on this together with the U.S. to resolve the issue.

Malmström, who confirmed to the BBC that the Commission is in the process of drafting a response to Trump said, “We are looking at all possibilities to retaliate, meaning we will also put taxes or tariffs on US imports to the EU,” but added that the Commission will wait for a final decision and would take the issue to the WTO if the US Congress follows through with implementing Trump’s new protectionist measures.

According to EU officials, 25% tariffs could apply on around €2.835 billion worth of imports from the US. Brussels will likely target big names and products such as Levi’s jeans, Harley-Davidson motorbikes and Jim Beam,  a top producer of American corn-based whiskey that is more commonly known as Bourbon.

Brazil, Mexico, Canada, and Japan are following the EU’s lead and also preparing steps to counter Trump’s potential trade war.