From Cuba and Iran to Spain? U.S. Considers Trade Embargo Against Ally

U.S. President Donald Trump has begun identifying specific Spanish products that could be subject to an embargo, following his threats of a trade cutoff against Spain over its reluctance to increase defense spending.

Attention is focused on whether this new form of trade pressure, which goes beyond tariffs to block the import of products from a specific country, will become a reality.

According to reports from Reuters and Politico on July 8 (local time), the U.S. Department of the Treasury, in coordination with the Department of Commerce and the Office of the United States Trade Representative (USTR), is expected to present President Trump with a list of Spanish goods that could face an embargo within the next few days.

This move is interpreted as a follow-up to President Trump’s criticism of Spain at the NATO summit, where he directly stated, "I don't want to trade with them anymore," after Spain rejected a goal to increase defense spending to 5 percent of its gross domestic product (GDP).

However, as a total halt in trade with Spain would inevitably deal a significant blow to the U.S. as well as Spain, it is suggested that the administration may select items for which the U.S. has alternative domestic suppliers but which are critical to the Spanish economy.

During his first term, the Trump administration previously imposed a 30 percent anti-dumping tariff on Spanish black olives at the request of the California olive industry.

Regarding the trade policy toward Spain, one source remarked, "Some review work was already underway last October," adding, "They are likely to pull out and use the data prepared at that time."

While President Trump has historically used high tariffs as leverage in negotiations to pressure other countries, this move is seen as an escalation in pressure, as he is now playing the "embargo card" to ban imports from a specific nation entirely.

Trade embargoes have traditionally been used by the U.S. as a sanction against hostile nations such as Cuba or Iran, making the consideration of such measures against an ally highly unusual.

Some analysts suggest that the U.S. is seeking new tactics after U.S. courts put the brakes on President Trump’s tariff policies, such as reciprocal tariffs.

In February, the U.S. Supreme Court ruled that the imposition of reciprocal (country-specific) tariffs based on the International Emergency Economic Powers Act (IEEPA) was unlawful.

Analysts warn that if this trade tactic using embargoes is realized, it could potentially be used as a new pressure tool against other allies that do not cooperate with U.S. security and foreign policy in the future.

However, such trade pressure measures are also expected to face various legal obstacles.

While the IEEPA can be used to impose trade embargoes or economic sanctions on specific countries, invoking it requires declaring a national emergency and proving that the country in question poses an "unusual and extraordinary threat" to U.S. national security or the economy.

Peter Shane, a law professor at New York University, pointed out, "It is difficult to see how one of the 32 NATO member states falling 3 percentage points short of a peacetime defense spending target constitutes an emergency for the United States."

Nevertheless, some interpret that because the Supreme Court did not rule on the nature of the "emergency" itself during the reciprocal tariff case, the authority to declare such an emergency remains intact.

Another variable that could arise if an embargo is implemented is the potential conflict with the trade agreement signed between the U.S. and the European Union (EU).

In July of last year, the U.S. and the EU reached a trade agreement (the Turnberry Agreement) that abolished tariffs on U.S. industrial goods imported into the EU, while capping U.S. tariffs on EU products and automobiles at 15 percent.

Because that agreement was signed by the European Commission on behalf of its 27 member states, a unilateral embargo on Spanish products could undermine the foundation of the agreement between the U.S. and the EU.

Politico noted that the agreement includes a clause allowing the EU to withdraw from the deal if either side violates its terms.

(Photo: AP, Yonhap News)
※ Please note: This article was translated by AI and may contain errors.