Musk calls for zero tariffs: free trade zone between USA and Europe under discussion!

Musk calls for zero tariffs: free trade zone between USA and Europe under discussion!

On April 5, 2025, the US government under President Donald Trump introduced global tariffs that have a direct impact on international trade. In a video message at the Lega party conference in Florence, Elon Musk, Trump's advisor, clearly spoke out in favor of a free trade zone between North America and Europe. Musk is calling for a “zero tariff situation” between the US and Europe – a proposal that is considered remarkable given Trump’s current increase in import tariffs on almost all products and countries. Starting next Wednesday, there will be a 20 percent surcharge for goods and services from the EU, which could put further pressure on international trade.

Trump justifies the measure by claiming that international trading partners are “ripping off” the US. This aggressive trade policy has drawn criticism from politicians and economists around the world. Stock markets are reacting to these developments with massive price losses, a sign that markets are concerned about the potential impact of a trade war.

The historical context of tariffs

The introduction of punitive and protective tariffs has a long history in global trade policy, dating back to the 19th century. During this period, many bilateral trade agreements were concluded between North America, Europe and East Asia to protect economic interests. Today, 164 countries are members of the World Trade Organization (WTO) and are officially committed to free trade, but there are numerous exceptions, as recent decisions by the US government show.

The WTO itself emerged from the General Agreement on Tariffs and Trade (GATT), which was merged into the WTO in 1994. Despite the prevailing free trade agreements, we continue to see a return to protectionist measures, such as the EU's punitive tariffs against Chinese solar modules in 2013, which were taken to protect their own industry.

Current trade policy and its consequences

Musk’s plea for a free trade zone between North America and Europe stands in stark contrast to current U.S. trade strategies. Times can be observed in which economic winners and losers, similar to the times of Otto von Bismarck, are a direct result of tariffs. The Smoot-Hawley Tariff Act of 1930, which imposed high tariffs, is often cited as an example that did not prevent the Great Depression but exacerbated it.

In today's situation we see that the USA is trying to reduce its influence in the global trading order, while at the same time conflicts with major trading partners such as China and the EU are expected. The Americans perceive the WTO rules as unfair, which increases the uncertainties in international trade and raises the question of whether the world economic scales are still bound to the free trade principles.

Developments in U.S. trade policy will continue to be closely monitored, particularly as economic conditions change rapidly and the risks of a trade war increase. Experts and analysts know that the dynamics of the global economy could shift significantly as a result of these strategy changes.