European Union to respond 'firmly' to Trump's tariffs
- Author: Salvatore Jensen Mar 03, 2018,
Mar 03, 2018, 7:14
The European Union has has drawn up a hit list of U.S. products from bourbon to Harley Davidson motorbikes on which to apply tariffs if Mr Trump follows through with the plan to apply global duties on aluminium and steel.
European Union trade chiefs are considering slapping 25 per cent tariffs on around $3.5bn (£2.5bn) of imports from the U.S.
No president should need to be told that trade wars are, in fact, bad and impossible to win.
The top economic adviser to Chinese President Xi Jinping is in the U.S. to discuss trade and economic cooperation between the two countries and the visit is seen as efforts to lower trade tensions.
The fighting words came after the billionaire politician's proposal sparked a furious reaction from major steel- and aluminium-producing nations and jitters in stock markets around the world. The U.S. hasn't yet indicated if any countries will be excluded.
The European Union is reported to be considering retaliatory tariffs, targeting United States steel, agriculture and other products. The larger steel side of it represents about 0.2 percent of the global trade, and just 3.3 percent of China's exports to America, on a par with the trade in shoes.
Trump's wrong-headed tariff plan would have a serious negative impact on the Hamilton-based steel producers at Stelco and Arcelor Mittel Dofasco and it certainly throws a hand grenade into the NAFTA negotiations. It is inappropriate for the U.S. to view any trade with Canada as a national security threat, she said.
Industry insiders were less restrained.
The EU would "form a coalition of like-minded countries and potentially take the United States to the WTO court together", Katainen said in reference to the World Trade Organization tribunal in Geneva. "Other countries, including China, will take relevant retaliatory measures". It has maintained a persistent trade deficit in steel for more than a decade, importing about four times as much steel than it exported past year.
Trump's move will likely raise steel and aluminum prices here.
"The tariffs will whack that menace to world peace known as Canada, which supplies 16 per cent (of USA steel imports)", said the paper.
The timing of Trump's announcement was provocative for China: its top economic envoy Liu He was in Washington, holding meetings at the White House on Thursday.
Safeguard measures, last deployed by Europe in 2002 after then-US President George W. Bush imposed steel import duties, would be created to guard against steel and aluminum being diverted to Europe from elsewhere if US tariffs come in.
Businesses that see the cost of goods rise have three options to make up the losses: cuts costs in other areas, simply absorb the cost and accept lower profit margins, or pass the costs onto consumers. The aluminum is a very small percentage of the cost.
"If you own a steel mill, today was great for you".
It's cheaper for U.S. consumers to buy things made overseas, and that's what they've been doing for many years.
He said he believes that, by necessity, Canada and Mexico will get exempted from tariffs.
It takes time to ramp up steel production, meaning that in the short term American consumers bear the costs of paying the tariffs, Volpe said. "Whilst we have to resist any urge to mirror such protectionist moves, we must at the same time be clear-eyed and equip ourselves with tools to respond effectively and protect our interests when necessary", said U.K. Steel Head of Policy, Richard Warren.
A US move on tariffs risks provoking retaliation, particularly from Beijing.
It noted that Canada supplies more steel to the U.S.by orders of magnitude than China - the supposed target of this tariff.
"But laying down worldwide tariffs on steel and aluminum is the wrong way to counter China", Coy wrote Friday.
Trump "made clear that this would be an across-the-board tariff with no exclusions", the official told reporters.
"This is going to scare markets, but it's not going to scare the Chinese government", Posen said.
A Chinese foreign ministry spokesman said: "If all countries followed the example of the United States, [it] will undoubtedly result in a serious impact on the global trade order".