An escalatory spiral that leads towards Eurasia's 10% 'trade war' scenario, however, would prompt Brussels to deploy escalatory measures, such as "export controls/duties, public procurement curbs, and/or penalties on U.S. services exports" by using the ACI "trade bazooka as a last resort," they concluded.

President Donald Trump’s threat to impose 30% tariffs on the European Union starting Aug. 1 disrupted negotiations and risks damaging a crucial trade relationship.