Giorgia Meloni is under pressure from Italy’s EU partners to “choose one side” in the transatlantic trade struggle while it has an effective veto for some major member states for Brussels to return strongly against US tariffs.
Italian Prime Minister-which has a friendly link with US President Donald Trump-opposes a Franco-German push to escalate the EU response to 20 percent of the so-called “mutual fee” to impose on its exports.
Paris and Berlin are among the European Commission member states to hit US services exports such as technology in response to Trump measures affecting more than 360bn € of its trade.
At a meeting of Ambassadors on Thursday, France, Germany, Spain and Belgium said the EU should be prepared to use its “trading bazox”, the instrument of antiques, for the first time to achieve this, two EU diplomats said.
But an action using the instrument can be blocked by a weighted minority of the Member States. Given the size of Italy, it would be the crucial member of No Camp, who also includes Romania, Greece and Hungary, diplomats said.
“At one point she will have to choose a side,” one of them said. “There are many conversations about services like the next step.”
The Conservative Nationalist told FT last week that it was “childish” and “superficial” to suggest that she had to choose between the US and Europe, insisting that it protects Italy’s interests.
Meloni has criticized Trump’s EU tariffs this week as “a wrong decision”. But she has called for calm and sincere negotiations, warning that escalation endanger further damage to European economies.
“I am not convinced that the best solution is to respond to tariffs with other tariffs,” the Italian leader told the RAI state broadcaster on Thursday, stressing that Italy wanted the tariffs “were not removed”.
A Eurosceptic of Voice in opposition, Meloni has “played Top” in Brussels since he came to power two years ago, said the second diplomat, who mentioned “its weakness to markets given Italy’s debt and deficit levels” as a possible reason it “stayed inside.”
However, they said, if negotiations do not make progress in the coming weeks, Melon would be required to support revenge against SH.BA
“It is about the protection of Italy. We all do it from time to time. But we all have to have some pain to maximize the pressure in the US. Trade is the first great test,” they said.
Melon’s concern about a trade war reflects the opinion between business groups in Italy, which still sees the US as an ally and friend, as well as the country’s second largest export market.
“In this case, there is a single place that is self-making on a massive scale,” said Marco Simon, who was an economic adviser to two former center-left Italian prime ministers.
“What do you do if a friend is self-making, even if you are provoking you for some harm? You tell him,” don’t do it. “But let’s keep it fresh. Don’t start wars.”
Simon argued that the devastating effects of tariffs on the US economy, including business bankruptcies and job losses, would lead to strong internal pressure on a return return.
“Wait six months. The US will be in the open recession and the US companies will beg the government to lift the fees,” said Simon, who teaches at Luiss University of Rome.
If the countries retaliate, he said, “we’re giving a big advantage to Trump – when the recession strikes America, he will tell the electorate that we are in recession because of revenge.”
The anti-CERTION instrument allows for vengeful measures, such as the revocation of the protection of intellectual property rights or their trade use through, for example, software discharges and transmission services.
Brussels can also block foreign direct investment or limit market access to banking, insurance and other financial services groups.
Ireland has publicly opposed using ACI – which was agreed in 2023 – ahead of a meeting of an EU Minister in Luxembourg on Monday.
The Meloni office and other ministries refused to comment on Rome’s view of using the instrument. But on Thursday, Melon also said that the EU should respond to the challenge by pressuring for deeper integration of the European economy and shortening regulatory loads.
Even before this week’s global global announcement, Trump had imposed 25 percent of sector taxes on steel, aluminum and cars.
The European Commission has said it will take revenge on steel tariffs up to 26m of € US exports. Ireland, France and Italy have demanded that Bourbon’s whiskey be removed from the list of products to be targeted.
The Commission will send its final list of revenge, which is separated from any use of the counter-control instrument in Member States on Monday, with an expected vote on April 9. If adopted they will become law on April 15 and would be implemented from May 15.
European Commission President Ursula von Der Leyen said after Trump’s announcement that the EU was preparing further revenge, but it was “ready to negotiate to remove any remaining obstacles to transatlantic trade”. Commission officials said the EU would not do so unilaterally, however.
Karl Falkenberg, a former senior EU trade official and now Shearwater consulting adviser, said the Block will have to hit US services exports to create lever.
“You will have to go after services, where you can do maximum damage. You can only negotiate against US measures when you have your measures to negotiate with it,” he said.
