EU ready to retaliate against Trump’s proposed trade tariffs

EU ready to retaliate against Trump’s proposed trade tariffs

Bloc prepares to slap tariffs on US products, including Levi’s jeans and Harley Davidson, while expressing hope that US president will change his mind

European Commissioner for Trade Cecilia Malmstroem speaks during a media conference at EU headquarters in Brussels on March 7, 2018. (AP Photo/Virginia Mayo)
European Commissioner for Trade Cecilia Malmstroem speaks during a media conference at EU headquarters in Brussels on March 7, 2018. (AP Photo/Virginia Mayo)

BRUSSELS (AP) — The European Union warned Wednesday that it was ready to retaliate against the United States over US President Donald Trump’s proposed tariffs on steel and aluminum, with counter-measures against iconic US products like Harley Davidson motorcycles, Levi’s jeans and bourbon.

Trade Commissioner Cecilia Malmstroem said that the EU, the world’s biggest trading bloc, rejects Trump’s reasoning that the tariffs are backed by international legal right to protect national security. Should tariffs be introduced, the EU and other partners would take the case to the World Trade Organization, she said.

“We cannot see how the European Union, friends and allies in NATO, can be a threat to international security in the US,” Malmstroem told reporters in Brussels. “From what we understand, the motivation of the US is an economic safeguard measure in disguise, not a national security measure.”

Trump has long railed against what he deems unfair trade practices by China and others, and last week declared that his government would levy penalties of 25 percent on imported steel and 10 percent on aluminum imports. The tariffs, he said, would remain for “a long period of time,” but it was not clear if certain trading partners would be exempt.

Malmstroem said Trump’s motives do not appear compatible with WTO rules and that this means the EU can activate safeguards to protect its own markets.

US President Donald Trump speaks on steel and aluminum tariffs during a meeting with industry leaders in the Cabinet Room of the White House on March 1, 2018 in Washington, DC. (AFP PHOTO / MANDEL NGAN)

She confirmed that the EU’s counter-measures would include tariffs on US steel and agricultural products, as well as other products like bourbon, peanut butter, cranberries and orange juice. EU Commission President Jean-Claude Juncker has said that Harley Davidson motorcycles and Levi’s jeans could also be hit.

The list is being circulated among EU member states for approval. The Commission also has plans in case steel from other producers is dumped on European markets.

In Berlin, Germany’s economy minister warned that “the situation is serious.”

Economy Minister Brigitte Zypries, whose country is Europe’s economic powerhouse, said the EU would “be ready to react appropriately. However, it is our goal to avoid a trade war.”

In this file photo taken on December 12, 2014 an employee cuts into an aluminium roll at the Constellium factory in the eastern French city of Biesheim. (AFP PHOTO / Patrick HERTZOG)

Zypries said in a statement she hopes Trump will change his mind.

“Trade creates wealth, when it is based on exchange and cooperation,” she said. Referring indirectly to the surprise resignation of Trump’s top economic adviser Gary Cohn Tuesday, she added that “advocates for this in the US administration are very important. Therefore the current signals from the US make me worried.”

Malmstroem underlined that the real problem is oversupply of steel and aluminum in the global market, and she urged Washington to work with the Europeans to address the root causes.

She recalled that similar US action on steel in 2002 by then president George W. Bush “cost thousands and thousands of US jobs” and said she hoped that Washington has not forgotten this.

At that time, the EU compiled a list of items for retaliatory tariffs that included steel products, but also orange juice, apples, sunglasses, knitwear, motorboats and photocopying machines. It represented $2.2 billion in US exports to the EU. Bush withdrew the steel tariffs and the list was never acted upon.

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