On April 3, 2025, the Spanish Government announced the deployment of an economic response package aimed at mitigating the negative impacts of potential tariffs introduced by the Trump administration.

The total response plan amounts to €14.1 billion, which includes €7.4 billion in newly created financial instruments and €6.7 billion restructured from existing mechanisms, as detailed by Prime Minister Pedro Sánchez during a meeting at the Moncloa with business leaders and social agents affected by the tariffs.

The contingency plan is structured around two main pillars.

The first pillar focuses on providing immediate support to businesses and safeguarding employment that may be threatened by U.S. tariffs.

To this end, the government will establish two financing lines worth €6 billion, including a new guarantee scheme of €5 billion and an additional mediation mechanism leveraging an existing tool amounting to €1 billion.

These funds will be managed by the Official Credit Institute (ICO), as maintaining credit flow is a priority for the Ministry of Economy.

In addition, the government has launched a €200 million fund, named the Productive Industrial Investment Support Fund, intended for companies looking to modernize or establish new production facilities.

This fund represents a reconfiguration of a pre-existing mechanism rather than a new initiative.

The automotive sector, significantly impacted by the tariff threats, is set to benefit from the Moves III plan, which allocates €400 million aimed at stimulating electric car purchases.

This initiative, which was approved in a previous cabinet meeting, retroactively activates from January 1, 2025.

Ensuring transparent communication with social dialogue, the government has established a social dialogue table involving businesses and trade unions to address the needs of affected sectors.

Sánchez also announced the immediate convening of a Sectoral Conference on Trade to engage with regional governments regarding the prevailing situation, a request previously made by the leader of the Popular Party, Alberto Núñez Feijóo. Additionally, Economy Minister Carlos Cuerpo will consult with parliamentary groups and present the proposed measures in Congress.

Regarding employee assistance, Sánchez revealed the activation of the 'Red' mechanism, designed to prevent layoffs by preserving employment, a tool previously employed during the pandemic.

The second pillar of the contingency plan is oriented towards redirecting productivity and promoting relaunch.

This involves steering market focus from the U.S. towards alternative opportunities.

To facilitate this transition, Sánchez announced the reallocation of €5 billion from the Recovery Plan towards industries and companies that can adjust their production capabilities to meet emerging sector demands.

The Ministry of Economy will play a crucial role in this market expansion effort, largely through the Internationalization Institute (Icex).

To support these businesses, the government will release €2 billion in credit insurance, managed by Cesce, which will cover risks associated with exports, alongside an additional €500 million earmarked for the internationalization of small and medium-sized enterprises (SMEs).

Furthermore, the government has convened an Interministerial Commission for the Commercial Response and Relaunch, calling upon the European Commission to safeguard European interests.

Spain will advocate for urgent measures from Brussels, including the establishment of a special state aid framework, direct funds for impacted sectors, a review of community regulations, and the final ratification of the Mercosur agreement.

Sánchez has recently discussed these issues with Ursula von der Leyen and Trade Commissioner Maroš Šefčovič.

Highlighting the historical economic relationship between Europe and the United States, Sánchez emphasized that this partnership has led to significant growth in GDP per capita and daily trade exchanges.

He criticized the Trump administration's shift towards protectionism, describing it as a regression to outdated economic practices.

During his announcement, Sánchez also refuted claims made by Trump regarding tariffs and trade imbalances, clarifying that the European Union's average tariffs are around 3% and asserting that the EU's trade balance is largely equitable.

The communication concluded with the unveiling of a government-produced promotional video showcasing the Spanish industrial landscape, encouraging a message of solidarity and support for local products.