On Wednesday, US President Donald Trump ordered a trade embargo on Spain, asking Treasury Secretary Scott Bessent to “cut off all trade ... including visits” with the country amid tensions over defense spending.
The Treasury Department, the Department of Commerce and the Office of the US Trade Representative will work to present Trump with “a menu of Spanish products that may be embargoed in the coming days”, a US official told Reuters. The remarks suggest that, despite Trump’s sweeping language, any trade ban is likely to have limits.
What Powers Does the US President Have to Impose a Trade Embargo?
Trade lawyers say Trump still has the International Emergency Economic Powers Act (IEEPA) at his disposal, despite a February decision by the US Supreme Court rejecting his use of the law to impose tariffs.
To invoke IEEPA, Trump would have to declare a national emergency linked to an “unusual or extraordinary threat” to US national security, foreign policy or the economy.
The law has been widely used to restrict trade with Iran, Russia and North Korea and to block dollar-denominated transactions by thousands of companies, individuals and other entities deemed a threat to national security.
However, Peter Shane, a law professor at New York University, said it was “difficult to understand” how one of NATO’s 32 members, having missed its peacetime defense spending target by three percentage points of GDP, could constitute such an emergency for the United States.
The Supreme Court, however, did not address the substance of Trump’s tariff emergency, leaving his authority to declare a national emergency “untouched”, said Mayur Patel, a former Republican trade adviser to the US Senate Finance Committee.
“The IEEPA would allow Trump to impose an embargo”, said Patel, now a partner at the Washington law firm Hogan Lovells, even if such a move were later challenged in court.
What Impact Would an Embargo Have on Trade?
US Census Bureau data show that total two-way trade in goods exceeded $47.9bn (€41.9bn) in 2025. Including services such as tourism, the figure rises to $74.5bn (€65.2bn), Bureau of Economic Analysis data show, making Spain the United States’ 23rd-largest overall trading partner.
The US exports more goods to Spain than it imports. In 2025, it exported $26.6bn (€23.3bn) to Spain, while imports totaled $21.35bn (€18.7bn), resulting in a US trade surplus of $5.25bn (€4.6bn).
According to US Census Bureau data, the most important categories of goods imported from Spain are pharmaceuticals, electrical transformers and voltage converters, personal hygiene products, petroleum products, glazed ceramics and olive oil. The leading US exports to Spain are pharmaceuticals, crude oil, civil aircraft and corn.
An embargo could also disrupt bilateral investment. According to Eurostat data cited by the American Chamber of Commerce in Spain, Spanish companies have invested €97.2bn ($111bn) in the US, making it their largest investment destination worldwide.
The US is Spain’s biggest foreign investor, with fixed-capital investments of more than €116bn ($132.4bn), supporting about 200,000 jobs across the country.
What Would Happen to Travel Between the Two Countries?
It is unclear how Trump might restrict travel by Spaniards to the US, where Spain’s national football team is due to play a World Cup match on Friday. Last year, however, his administration banned citizens from more than 30 countries, including tourists, students and business travelers, from entering the United States, citing security concerns.
Trump also did not specify whether a travel ban would apply to Americans visiting Spain, whose spending there is counted as US imports of services.
According to the Spanish Statistical Office, around 4.45 million Americans visited Spain for more than one day in 2025, a 4.3% increase from 2024. In 2026, Americans accounted for around 4.6% of the country’s 96.8 million visitors. On that measure, the United States ranks sixth, behind the United Kingdom, France, Germany, Italy and the Netherlands.
According to the Bank of Spain, however, US travelers were Spain’s fourth-largest source of tourism revenue in 2024, spending €6.15bn ($7bn). The bank noted that Americans typically stay longer and spend more per trip than other tourists.
What Options Does Trump Have Besides a Complete Embargo?
Patel said Trump could also use IEEPA to impose a selective embargo, as both he and his predecessor Joe Biden did against Russia, while allowing the import of certain goods deemed essential. In Russia’s case, those exemptions included enriched uranium, fertilisers and palladium.
Trump has previously exempted aircraft parts from tariffs, so possible candidates could include jet-engine turbine components made by the Spanish company ITP Aero, which are used by General Electric and Pratt & Whitney, a subsidiary of RTX.
Trump also has other tools to impose tariffs or retaliatory trade measures, including Section 301 of the Trade Act of 1974, which targets unfair trade practices. On that basis, the Trump administration is currently proposing tariffs linked to alleged forced labour in goods from 60 US trading partners, including the European Union.
Trump can also turn to Section 232 of the Trade Expansion Act of 1962, a Cold War-era law he has used to protect the automotive, steel and aluminium industries, as well as other sectors deemed vital to national security.
One complication for any trade measures against Spain is that the European Union sets trade policy for its member states and requires uniform treatment across the bloc. However, the US has previously threatened individual EU countries with tariffs over their digital services taxes.
The Department of Commerce could also target specific Spanish imports through anti-dumping and anti-subsidy investigations. At the request of California olive growers, for example, Trump’s first administration imposed a 30% anti-dumping duty on Spanish black olives under the Tariff Act of 1930, while a separate Commerce Department investigation concluded that the olives benefited from unfair subsidies.
Trump Had Threatened Spain Before
The first threat of trade sanctions came in October 2025, when Trump said he “might” impose tariffs on Spain for refusing, four months earlier at the NATO summit in The Hague, to commit to raising defense spending to 5% of gross domestic product.
In March this year, he went further, ordering Bessent and Trade Representative Jamieson Greer to launch investigations aimed at imposing an embargo on all products from Spain. So far, no such investigations have been published in the Federal Register.
According to the latest NATO estimates, Spain’s basic defense spending is projected to reach €35.41bn ($40.4bn) in 2026, equivalent to 2% of GDP. That is up from €11.17bn ($12.8bn) in 2018, when Prime Minister Pedro Sánchez took office.