Trump could block Spain’s trade with IEEPA, ‘reciprocating’ tariff law: Greer

Americans don’t need to panic buy Iberico ham just yet.

US Trade Representative Jamieson Greer said Thursday that President Donald Trump might not be able to follow through on his demand for the US to completely cut off trade with Spain — but he could use the same law behind his failed “reciprocating” tariffs if he wanted to.

Greer told reporters at the White House that even though Spain is a member of the European Union, Trump could secede from it using the International Emergency Economic Powers Act, or IEPPA.

Law empowers the President Imposing certain economic sanctions in response to the declared national emergency. Trump insisted that the law authorizes him to impose individual tariff rates on nearly every country, but in February the Supreme Court struck down those import tariffs.

“Everyone has heard about IEEPA, famously last year with respect to us, our tariffs, but the reality is IEEPA has been in place for several decades,” Greer said Thursday.

“It’s currently an authorization that’s used to limit trade with places like North Korea,” Greer explained.

He said that even though the Supreme Court found that the IEEPA did not support Trump’s tariffs, its decision “highlighted that the IEEPA clearly says you can restrain trade, you can do certain things.”

But the trade official stressed that while Trump “certainly” could take that step, he may not want to do so now.

That’s because Trump and Spanish Prime Minister Pedro Sanchez recently had a “good meeting” to discuss “key issues about payments,” Greer said.

“I’ve heard about positive developments on that front in Spain,” he said.

That would be a major change from a day earlier, when Trump, apparently exasperated by Spain’s resistance to increasing its defense spending as part of NATO, suddenly announced he had stopped working with the country in any way.

“Spain is a terrible partner in NATO. They don’t participate. They don’t pay. I don’t want anything to do with Spain,” Trump said while speaking to the media at the NATO summit in Ankara, Turkey.

According to the , Spain’s top exports to the US include refined petroleum, pharmaceuticals and electrical transformers. Observatory of Economic Complexity.

“Please close all trade with Spain, including travel,” Trump said, sitting next to NATO Secretary General Mark Rutte.

Trump has demanded that all NATO allies increase their defense spending to 5% of their GDP to spread the alliance’s cost burden more evenly. Most members have agreed to raise their spending targets – but so has Spain rejected NATO’s proposal was described as “unfair”.

After leaving Türkiye, Trump himself softened his tone towards Spain.

“I had problems, and I still have, but Spain came back today. Spain was very generous today,” Trump told reporters on Air Force One as he returned to the US.

Asked what Spain did to get back in its good graces, Trump, after a pause, said the country had “honored the request for a lot of payments.”

It was unclear what specifically Spain had agreed to, if anything. The US Embassy in Spain did not immediately respond to CNBC’s request for comment on Trump and Greer’s comments.

This week was not the first time this year that Trump and Sanchez have clashed. In March, when the US launched a war against Iran, Sanchez criticized the attacks and Trump then also threatened to cut trade.

Asked Thursday whether Trump was no longer seeking a Spanish trade divorce in light of the meeting with Sanchez, Greer said, “I don’t want to get ahead of him … but it sounds like it was very positive.”

Pressed for clarity, Greer said Trump has “many options,” and said the president has looked at Spain’s spending before.

Greer said he has been in touch with Treasury Secretary Scott Besant, who traveled with the president to Turkey.

“I don’t think there’s anything imminent,” Greer said regarding a trade halt with Spain.