A domino theory of tariffs is playing out in Europe, as a US policy that began with steel now threatens to knock over entire sections of the EU economy. The expansion of duties to “derivative” products has started a chain reaction that could impact everything from manufacturing and construction to green energy and consumer goods.
The first domino was the steel industry itself, hit by tariffs of up to 50%. This immediately put pressure on a vital sector. The second domino was the list of 407 categories of manufactured goods, which directly impacted the users of that steel, such as the makers of cranes, bulldozers, and rail cars.
Now, the fear is that the next dominoes are about to fall. The new US consultation could add products like windows and doors, hitting the construction sector. The inclusion of motorbikes harms the automotive industry. The threat to tables and kettles shows that consumer goods are also in the line of fire.
This chain reaction is what worries European leaders most. As Bernd Lange, a top MEP, warned, the policy is “really harming a lot of industries,” not just one. Eurofer, the steel association, echoed this, stating the threat is to “EU manufacturing as a whole.”
This domino effect illustrates the interconnected nature of the modern economy. A targeted push in one area can create an unstoppable cascade. The challenge for the EU now is to stop the chain reaction before it topples the core pillars of its industrial base.