The EU is preparing to impose a 75% tariff on a list of US goods worth €35bn if Washington goes ahead an imposes tariffs of European car imports.

 “We will not accept any managed trade, quotas or voluntary export restraints and, if there were to be tariffs, we would have a rebalancing list,” European Trade Commissioner Cecilia Malmstrom told a committee of the European Parliament.

In a report published on Tuesday, the IMF cites tariffs on EU car exports to the US as one of the major risk factors to the global economy in 2019.

President Donald Trump has repeatedly threatened to hike tariffs on EU car imports to 25%. On Monday, German economy minister Peter Altmaier reiterated that the EU could be willing to drop levies on American cars to zero in order to avert a trade war.

In May, Trump suspended threatened tariffs on imports of cars from the EU for six months to allow time for a new trade agreement to be negotiated. In an election year, President Trump is keen to target the EU’s $169 billion trade surplus with the US. In 2018, Germany exported approximately €26bn worth of cars and car parts to the US.

Concerns are rising as the EU may be caught right in the middle of the Sino-American trade war, facing possible export barriers from China as well.

China plans to impose an anti-dumping tax on some stainless-steel imports from the European Union, South Korea, and Japan.

The anti-dumping duties of 18.1% kicked in on Tuesday, July 23. The Chinese move is a twin blow for the EU steel producers, who already suffer from global overcapacity attributed mainly to China. The US has met this overcapacity by tariffs and the EU market has become a final destination for quantities originally bound for the US.