European Union warns Trump that auto tariffs could lead to $300B retaliation

Roman Schwartz
July 5, 2018

China is putting pressure on the European Union to issue a strong joint statement against President Donald Trump's trade policies at a summit later this month but is facing resistance, European officials said. It won't target the 284 additions, worth $16 billion, until it gathers further public comments. Its tariffs are meant to deliver pain to American farmers, who overwhelmingly backed Trump in the 2016 election and whose interests are represented by powerful lobbyists and members of Congress.

In response, Flake stressed that the United States needs its allies.

The business lobbying group says farm states and states with large auto production plants will be particularly vulnerable. Trump has long expressed his dissatisfaction with a number of trade deals with overseas trading partners.

The commission said "up to $294bn (£223bn) of United States exports. could be subject to countermeasures" that would be considered by the European Union and other trading partners, which amounts to nearly a fifth of the total value of USA exports in 2017.

On Sunday, Trump said the European Union was "as bad" as China when it came to the way European countries traded with the US. The U.S. also asserts that Beijing uses state money to buy American technology at prices unaffordable for private companies.

Using a state-by-state analysis, it argues that Trump is risking a global trade war that will hit the wallets of USA consumers.

Trump's government is threatening to raise tariffs for EU-made cars to 20% to "rebalance" the EU's 10% tariff on cars imported into its region. But they treat us very badly.

An Indiana church created this controversial display as a protest against Trump
Over the weekend, hundreds gathered near the Indiana Statehouse as part of a nationwide protest against family separation. The administration said about 500 children have since been reunited with their parents.

In May, Trump ordered an investigation into whether imported cars and automotive components could pose enough of a national security risk to warrant tariffs of as much as 25%.

The Chamber highlighted vulnerable exports from states that had supported Trump in his surprise 2016 presidential election victory: $2.3 billion in MI steel and aluminum goods as well as autos, $1.7 billion in Pennsylvania steel, iron, coffee and baked goods and $1 billion in Wisconsin cheese, toilet paper and ginseng all face retaliation from USA trading partners.

One proposal has been for China and the European Union to launch joint action against the United States at the World Trade Organization.

Trump's views on tariffs have been a sore subject, even among fellow Republicans who have criticized Trump's imposition of steep tariffs against US allies.

In May, Mr. Trump ordered an inquiry into the possibility of imposing tariffs on vehicle imports.

However, the White House later played down Mr Trump's tweet.

European envoys say they already sensed a greater urgency from China in 2017 to find like-minded countries willing to stand up against Trump's "America First" policies.

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