Nations puzzle over how to respond to US trade war as global markets gyrate

But she warned that "we are also prepared to respond through countermeasures and defend our interests."

China has already hit back against the U.S. with retaliatory tariffs and similar actions from Europe and elsewhere remain a significant possibility.

The U.S. and the EU had a zero-for-zero deal on wine and spirits from 1997 to 2018, and reducing many tariffs to zero was a goal of complex negotiations for a US-Europe free-trade deal before negotiations stalled in 2016.

Yet there was little indication Trump is ready to deal. The EU trade commissioner, Maros Sefcovic, spoke for two hours with Trump administration Friday and would say only that "we stay in touch."

And White House trade adviser Peter Navarro told CNBC on Monday that an offer by Vietnam to eliminate tariffs on U.S. imports would not lead to a pullback on the the newly announced 46% levy on its imports to the U.S.

"Let's take Vietnam. When they come to us and say 'we'll go to zero tariffs,' that means nothing to us because it's the non-tariff cheating that matters," Navarro said on CNBC.

Major trade partner China was taking a tougher line and accused the U.S. of "bullying" after imposing a 34% tariff on Friday on all US goods, the exact same rate Trump slapped China with in his latest round of new import taxes.

Several other countries said they were sending trade officials to Washington to try to talk through the crisis, which has cast uncertainty over the global economic outlook, hammered markets and left U.S. allies wondering about the value of their ties with the world's largest economy.

European Union trade ministers were closeted Monday in Luxembourg to weigh possible steps that could include taxes on U.S. tech companies like Google, Apple and Amazon. The European Union's executive commission - which handles trade issues for the 27-country bloc - is set to impose tariffs on Jeans, whiskey and motorcycles on Wednesday in response to Trumps increase in steel and aluminum tariffs.

But it hasn't decided a response yet to Trump's "reciprocal" tariff of 20% on European goods announced Wednesday and a 25% tariff imposed on autos from everywhere. French officials have raised imposing tariffs on services like internet commerce or financial services, where the U.S. sells more than it buys from Europe and is in theory more vulnerable than in goods trade.

Germany's economy minister, Robert Habeck, was defiant as he arrived, saying the premise of the wide-ranging tariffs was "nonsense" and that attempts by individual countries to win exemptions haven't worked in the past.

It's important for the EU to stick together, he said. That "means being clear that we are in a strong position — America is in a position of weakness."

So far the European approach has been to selectively target politically sensitive goods rather than impose sweeping retaliation since like most economists officials they view tariff wars as a lose-lose game.

China, which hit back Friday at Washington with 34% tariffs on U.S. products and other retaliatory moves, sharply accused the U.S. of failing to play fair. "Putting 'America First' over international rules is a typical act of unilateralism, protectionism and economic bullying," Foreign Affairs spokesperson Lin Jian told reporters.

The ruling Communist Party struck a note of confidence even as markets in Hong Kong and Shanghai crumpled. "The sky won't fall," declared The People's Daily, the party's official mouthpiece. "Faced with the indiscriminate punches of U.S. taxes, we know what we are doing and we have tools at our disposal."

China's Commerce Ministry said officials met with representatives of 20 American businesses including Tesla and GE Healthcare over the weekend and urged them to take "concrete actions" to address the tariffs issue.

During the meeting, Ling Ji, a vice minister of commerce, promised that China will remain open to foreign investment, according to the readout by the ministry.

Other Asian nations seek negotiations

South Korea's Trade Ministry said its top negotiator, Inkyo Cheong, will visit Washington this week to express Seoul's concerns over the 25% tariffs on Korean goods and discuss ways to mitigate the damage to South Korean businesses, which include major automakers and steel makers. Asian countries are among the most exposed to Trump's tariffs ranging from a baseline 10% to 50% since their export-oriented economies send a lot of goods to the U.S.

Pakistan also planned to send a delegation to Washington this month to try negotiate over the 29% tariffs on its exports to the U.S., officials said. The prime minister ordered Finance Minister Muhammad Aurangzeb to assess the tariff's potential impact on Pakistan's fragile economy and draw up recommendations.

The U.S. imports around $5 billion worth of textiles and other products each year from Pakistan, which heavily relies on loans from the International Monetary Fund and other lenders.

In Southeast Asia, Malaysia's Trade Minister Zafrul Abdul Aziz said his country will seek to forge a united response from the Association of Southeast Asian Nations to Trump's sweeping tariffs.

As chair of the 10-nation body this year, Malaysia will lead a meeting Thursday in its capital Kuala Lumpur to discuss broader implications of the trade war on regional trade and investment, Zafrul told reporters.

"We are looking at the investment flows, macroeconomic stability and ASEAN's coordinated response to this tariff issue," Zafrul said.

He said that he had met with the U.S. ambassador to Malaysia to try to clarify how the U.S. came up with its 24% tariff.

Indonesia plans to increase imports from US

Indonesia, one of the region's biggest economies, said it would work with businesses to increase its imports of U.S. wheat, cotton, oil and gas to help reduce its trade surplus, which was $18 billion in 2024.

Coordinating Economic Affairs Minister Airlangga Hartarto told a news conference that Indonesia will not retaliate against the new 32% tariff on Indonesian exports, but would use diplomacy to seek mutually beneficial solutions.

Some Southeast Asian neighbors, including Vietnam, Cambodia, Laos and Myanmar, face tariffs of over 40%, giving Indonesia a slight advantage, he noted.

"For Indonesia, it is also another opportunity as its market is huge in America," Hartoto said. He said Indonesia would buy U.S.-made components for several national strategic projects, including refineries.