Trump on trade: European Union 'possibly as bad as China'

Trump European Union is 'possibly as bad' as China on trade

Trump European Union is 'possibly as bad' as China on trade

According to a report in the Financial Times, a letter sent by the European Commission to the US Department of Commerce says the EU could hit $300 billion - the equivalent of well over R4 trillion - of US goods with tariffs, if Trump follows through on his threats to place big taxes on European vehicles being imported in the US.

On Monday, the country's largest business group launched an online campaign against President Donald Trump's hardline stance on trade, which his press secretary described as a way to "create a fair playing field" for US businesses.

It also argued that tariffs on cars and auto parts could hurt economic growth in North America, with an estimated initial $US13-14 billion hit on U.S. gross domestic product. He is considering extending the levies to the auto sector.

Trump has singled out the Europeans as a problem as great to the U.S. on trade as China and laid out threats to fight the EU with a 20 percent duty on EU auto imports, a particular source of his scorn.

The Chamber, which has three million members, historically has worked closely with Republican presidents and praised Trump for signing business tax cuts in December.

"No one has asked for protection under our laws protecting against fairly traded imports, for the simple reason that our industry is thriving".

But for Murphy and the Chamber of Commerce, threatening companies whose businesses largely rely on exports was not the most constructive strategy in bringing trade to a fair playing field.

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

The bloc exported 37.4 billion euros (US$43.6 billion) of cars to the United States in 2017, while 6.2 billion euros worth of cars went the other way.

Meanwhile, the European Union argued that the US's comparably low auto import tariff was countered by higher rates on other vehicles, such as lorries.

Motorcycle maker Harley-Davidson said earlier this week that new tariffs imposed by Europe on certain manufactured goods will cause a "tremendous cost increase" that the company will have to shoulder.

It also said that global competitiveness would be threatened.

When the US Census Bureau published the latest statistics showing the discrepancy in trade between the United States and China, it didn't make for happy reading. The survey reveals mounting worries from companies relating to the impact of tariffs and trade wars, suggesting firms are bracing themselves for the potential for further export losses. But Italy blocked their formal adoption until the migration issue was fully addressed.

Mr. Trump's administration wants Germany - which would be hardest hit by automotive tariffs - to pressure the European Union to come to an agreement.

Trump railed against his trading partners during the meeting, according to sources, and withdrew his support for a joint communique after leaving the summit, angering and bewildering some of Washington's closest allies. Harley Davidson announced it was moving some manufacturing overseas to avoid European Union motorcycle tariffs brought in as a response to U.S. duties on steel and aluminium imports.

Harley-Davidson, which dominates the heavyweight U.S. motorcycle market, subsequently announced it would shift some USA production overseas to avoid higher costs for European Union customers.

The European Union and Canada have also threatened to impose tariffs on billions of dollars worth of United States products. The Trump administration is also identifying an additional US$200b in Chinese goods for 10 percent tariffs, which could take effect if Beijing retaliates.

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