[🇺🇸] USA and EU/China/Canada Trade War

[Saif]

Date of Event: Feb 4, 2025 Source : https://www.newagebd.net/post/europe/257080/eu-vows-retaliation-if-trump-starts-trade-war

EU vows retaliation if Trump starts trade war
Agence France-Presse . Brussels, Belgium 03 February, 2025, 22:52

NATO secretary general Mark Rutte (C) speaks with French president Emmanuel Macron (CR) during an informal EU leaders’ retreat at the Palais d’Egmont in Brussels on Monday. | AFP photo

EU leaders meeting in Brussels Monday warned there would be no winners in a trade war with the United States, insisting they would hit back if US president Donald Trump imposes tariffs.

French president Emmanuel Macron said the European Union must show its muscle if US president Donald Trump makes good on his threat to target the bloc with a volley of tariffs.

‘If we are attacked in terms of trade, Europe—as a true power—will have to stand up for itself,’ Macron said.

The leaders of the EU’s 27 nations were huddling in the Belgian capital with Britain’s prime minister and the head of NATO to discuss efforts to boost Europe’s defences faced with an aggressive Russia—as Trump’s demands that American allies spend much more. But the discussions were overshadowed by the US leader’s decision to slap tariffs on Canada, Mexico and China—with Trump threatening to target EU next.

Poland’s prime minister Donald Tusk, whose country currently holds the EU presidency, said everything must be done to avoid a ‘totally unnecessary and stupid’ trade war.

Trump has not hidden his enmity for the EU, accusing it of treating the United States ‘very, very unfairly’ on trade.

After slapping levies on his North American neighbours and China, Trump doubled down on Sunday by saying he ‘definitely’ planned to target the EU in future.

German chancellor Olaf Scholz said a trade dispute would be ‘bad for the US, bad for Europe’, with transatlantic ‘cooperation’ preferable for both sides.

‘We can also react,’ he added, veering from Germany’s traditionally cautious approach to transatlantic trade relations.

‘We need America, and America needs us as well,’ echoed the EU’s top diplomat, Kaja Kallas, adding there were ‘no winners in trade wars’.

On Sunday, the European Commission said it would retaliate ‘firmly’ if Trump hit it and decried his sweeping measures against Canada, Mexico and China.

‘Tariffs create unnecessary economic disruption and drive inflation. They are hurtful to all sides,’ a commission spokesman said.

Up until then Brussels had said it hoped to avoid a trade conflict with Trump through negotiation.

Later European Council chief Antonio Costa held a night phone call with Canadian Prime Minister Justin Trudeau.

‘Both leaders underscored the importance of the EU-Canada bilateral relationship and confirmed their determination to continue to working together,’ an EU official said.

Since Trump was re-elected in November, Brussels has been working to diversify its trading partnerships, announcing in recent weeks both a strengthened trade deal with Mexico and the resumption of talks on a free trade deal with Malaysia.

Back in 2018, during his first term, Trump imposed tariffs on European steel and aluminium exports—leading the EU to respond with its own higher duties.​

 

[Bilal9]

I am watching in awed animation as this idiot ruins every ally relationship one by one and hastens the decline of America. I am afraid for the next generation of Americans.

What kind of irresponsible Ullu-ka-paththa would do this? 🙄

 

[Saif]

EU wants early US talks to avert Trump tariffs

The European Union wants to engage swiftly with the United States over President Donald Trump's planned tariffs, trade chief Maros Sefcovic said on Tuesday, while his boss Ursula von der Leyen stressed the bloc would protect its interests in negotiations. Sefcovic, speaking before a meeting of EU

thefinancialexpress.com.bd

EU wants early US talks to avert Trump tariffs
REUTERS
Published :
Feb 04, 2025 18:45
Updated :
Feb 04, 2025 18:45

Maros Sefcovic, the nominee to become the European Union's trade and economic commissioner, attends a confirmation hearing before the European Parliament's international trade and constitutional affairs committees, in Brussels, Belgium November 4, 2024. REUTERS/Johanna Geron, in Brussels, Belgium November 4, 2024. Photo : REUTERS/Johanna Geron/Files

The European Union wants to engage swiftly with the United States over President Donald Trump's planned tariffs, trade chief Maros Sefcovic said on Tuesday, while his boss Ursula von der Leyen stressed the bloc would protect its interests in negotiations.

Sefcovic, speaking before a meeting of EU ministers to debate trade and EU competitiveness, said he wanted "early engagement" and was awaiting confirmation of the appointment of Trump's pick for Commerce Secretary, financier Howard Lutnick.

"We are ready to engage immediately and we hope that through this early engagement, we can avoid the measures which would bring a lot of disturbance to the most important trade and investment relationship on this planet," he told reporters.

Von der Leyen, the European Commission president, said the EU executive's first priority was to work on the many areas where EU and US interests converge, such as critical supply chains and emerging technologies.

In a speech in Brussels, she said the EU was ready for tough negotiations to work out grievances and set the foundations for a stronger partnership.

"We will be open and pragmatic in how to achieve that. But we will make it equally clear that we will always protect our own interests – however and whenever that is needed," Von der Leyen said.

EU officials say contacts with the Trump administration have been limited so far, noting that Trump's picks for top jobs are not able to speak to foreign counterparts until their positions have been confirmed. Von der Leyen and Trump have not been in contact since Trump's inauguration.

The EU meeting in Warsaw started just a few hours after additional US tariffs of 10 per cent on Chinese goods took effect, prompting China to hit back. Canada and Mexico were also in line for 25 per cent US tariffs on Tuesday, but each secured a 30-day pause.

Trump has said the European Union is next in line. He has repeatedly complained about the US trade deficit with the 27-country EU.

Sefcovic said that deficit, including services trade, was around 50 billion euros, or around 3.0 per cent of overall annual EU-US trade of 1.5 trillion euros, while 4 million jobs on both sides of the Atlantic were reliant on this open trading relationship.

"We believe through constructive engagement and discussion we can resolve this problem," he said.

Sefcovic did not go into how the bloc might negotiate, but some ministers offered advice on the EU approach.

Luxembourg foreign minister Xavier Bettel, who was prime minister during Trump's first term, said the EU needed to be united and strong and not begin negotiations with concessions.

"This is not the Marrakech souk," he said. "We don't offer. We listen, we exchange, we say things. We don't offer."

Irish trade minister Peter Burke also said it was not worthwhile at this point to make offers.​

 

[Saif]

Trump tariff uncertainty overshadows growth promises: analysts

President Donald Trump’s tariffs and the retaliation they attracted will likely weigh on US growth and boost inflation, according to analysts, but, beyond that, uncertainty surrounding the levies threatens to overshadow optimism about his future policies.

www.thedailystar.net

Trump tariff uncertainty overshadows growth promises: analysts

This photo taken on January 23 shows cars waiting to be exported in a port in Lianyungang, east China’s Jiangsu province. Donald Trump reignited trade wars this week with hefty duties on Canadian, Mexican and Chinese imports, drawing sharp retaliation from Ottawa and Beijing. Photo: AFP/file

President Donald Trump's tariffs and the retaliation they attracted will likely weigh on US growth and boost inflation, according to analysts, but, beyond that, uncertainty surrounding the levies threatens to overshadow optimism about his future policies.

Trump reignited trade wars this week with hefty duties on Canadian, Mexican and Chinese imports, drawing sharp retaliation from Ottawa and Beijing, including new tariffs on key American farm products.

Collectively, these could dent US GDP growth by one percentage point and hike inflation by 0.6 points if kept in place for the year, said Nationwide chief economist Kathy Bostjancic.

"Tariffs represent a negative supply shock. It hurts production, raises prices," she told AFP, warning that business and consumer confidence also take a hit from levies. And the unpredictability of Trump's tariff plans stand to offset positivity about the president's promises of deregulation and tax cuts, which are seen as pro-growth, she said.

"That hope and excitement right now is overwhelmed by the uncertainty of what's going to play out," she added.

It also remains unclear if new tariffs will be long-lasting, and they come atop cost-cutting measures in the federal government which are being challenged in courts, KPMG chief economist Diane Swonk said.

The fallout from these efforts can undermine demand.

Trump has not only quickened the pace of tariff hikes in his second term by tapping emergency economic powers to impose them without an investigation period, but his levies cover a larger value of goods.

Trump's first-term tariffs hit $380 billion worth of US imports over 2018-2019, mainly from China, said Erica York of the Tax Foundation.

But his latest duties introduced over a month impact $1.4 trillion of imports, mostly from allies, she added.

"Because of the faster implementation and the larger magnitude, the new tariffs will be much more disruptive to the US economy than Trump's first trade war," York said.

While the situation is fluid, Bostjancic said prices of products like motor vehicle parts could rise by 10 percent within months, given how integrated North American supply chains are.

This could inflate consumer costs for big ticket items. Used car prices could increase if producing new vehicles became pricey, analysts said.

New homes stand to become more expensive too, potentially making property owners reluctant to move and weighing on the housing market, said Jessica Lautz at the National Association of Realtors.

Trump's latest 25 percent tariff on Canadian goods hits lumber imports, which are important to homebuilders.

With the breadth of Trump's current tariff plans, "some companies may not be able to maintain the same level of employment," Swonk of KPMG warned.

During Trump's first term, despite an initial uptick in steel industry employment when he imposed tariffs on imports of the metal, these were more than offset by higher input costs and layoffs elsewhere, she noted.

Other near-term effects include countries' readiness to to hit US "choke points" following experiences from his first administration, said Swonk.

"They're going to look for the places that are the biggest pinch points for the president's party and that's the Republican Party," she told AFP.

This means taking aim at Republican-dominated states.

When the world's biggest economy takes action like sweeping tariffs other countries tend respond strategically, targeting countermeasures at areas which likely have more political sway over the administration, she said.

Farm and food products are often primary targets of retaliation, said Wendong Zhang of Cornell University. This could spark the need for federal aid to farmers subsequently.

Already, China said it would impose 10 percent and 15 percent levies on various US agricultural exports including soybeans.

In Trump's first term, retaliatory tariffs on the United States caused more than $27 billion in US agricultural export losses from mid-2018 to late-2019.

Economists say the hit to growth and inflation in 2025 could be somewhat counterbalanced by aggressive deregulation efforts next year, as Trump's government seeks to rein in the budget deficit and make certain tax cuts permanent.

For now, the "uncertainty effect," serves as a tax of its own, Swonk said.​

 

[Saif]

China files complaint with WTO against US tariffs

Beijing said Tuesday it had filed a complaint with the World Trade Organization against the United States over President Donald Trump’s tariff increases on Chinese goods.

www.thedailystar.net

China files complaint with WTO against US tariffs

Beijing said Tuesday it had filed a complaint with the World Trade Organization against the United States over President Donald Trump's tariff increases on Chinese goods.

The statement comes a day after Trump ordered additional tariffs against Chinese goods, increasing previously imposed 10 percent levies to 20 percent.

"The United States' unilateral tax measures seriously violate WTO rules and undermine the foundation of China-US economic and trade cooperation," Beijing's commerce ministry said in a statement, adding that it was "strongly dissatisfied and firmly opposed" to the tariffs.

In response to the US tariffs, Beijing has imposed new duties on a range of agricultural imports from the United States. The additional 15 percent tariffs on products including chicken, wheat, corn and cotton are due to come into effect next week.

"China will, in accordance with WTO rules, firmly safeguard its legitimate rights and interests and defend... the international economic and trade order," the commerce ministry statement added.

"The United States' unilateral tax measures seriously violate WTO rules and undermine the foundation of China-US economic and trade cooperation," Beijing's commerce ministry said

A WTO official confirmed to AFP that the new complaint from China had been received.

Trump, in imposing the tariffs, said China had not done enough to halt the trafficking of fentanyl and other highly potent opioids that kill thousands of Americans each year.

Analysts say that stemming the flow of deadly drugs is just one aim for Trump, who also frequently mentions trade imbalances when discussing the tariffs.

In a white paper released Tuesday, China's National Narcotics Control Commission touted actions already taken to crack down on trafficking of fentanyl-related substances, state media reported.

"Since implementing full control of fentanyl-related substances, China has not detected any further cases of smuggling or selling fentanyl-related substances abroad," Xinhua reported, attributing the matter to a senior commission official.

China is a major market for US energy exports and according to Beijing customs data, imports of oil, coal and LNG totalled more than $7 billion last year.

Beijing launched a similar dispute in February when Trump first threatened the tariffs, describing the levies as "malicious" at the time.

It says it will also probe US tech giant Google and the American fashion group which owns Tommy Hilfiger and Calvin Klein.

Trump has made tariffs a key foreign policy tool of his second term, joking that the word tariff is the "most beautiful" in the dictionary.

The Republican has also imposed tariffs on Mexico and Canada which he says are punishment for failing to halt the flow of migrants and drugs into the United States.​