German Chancellor Olaf Scholz had slammed Trump's decision as “fundamentally wrong” and said that the EU could retaliate by targeting American tech companies.

“This is an attack on a trade order that has created prosperity all over the globe, a trade order that is essentially the result of American efforts,” Scholz said.

German Economy Minister Robert Habeck on Thursday also hinted at similar retaliation and said that every option was on the table. “The big tech companies have an incredible dominance in Europe and are largely exempt from European taxes,” he noted.

‘Recession more likely’

Carsten Brzeski, an economist at ING Germany, compared the trade barriers imposed by the White House and told The Telegraph that “the 1930s are back.”

Economists also warned that tariffs could risk trigger a recession in the German economy and drain around a half a percent of national output. Achim Wambach, president of the German Centre for Economic Research told the publication that, “The economic consequences are grave, particularly for Americans. Prices and inflation will rise, and a recession will become more likely.”

‘Not too late’

EU chief Ursula von der Leyen had said that 20% reciprocal tariffs on the bloc were a major blow for the world economy and vowed that it would retaliate if trade negotiations with the US fail. “(It is) not too late to address concerns through negotiations,” she noted.

“There seems to be no order in the disorder. No clear path through the complexity and chaos that is being created as all US trading partners are hit,” she said.

Scholz also backed the EU's efforts saying, “Europe will respond decisively, strongly, and appropriately” if talks fail.