European Union counter-tariffs against USA come into effect on Friday - commission

Marco Green
June 22, 2018

On March 1, President Donald Trump announced that the United States would be imposing a 25 percent global tariff on all steel imports to the USA and a 10 percent global tariff on all aluminum imports.

A trade war is brewing between the world superpowers, U.S. and China and this could have dire economic consequences, not just for the two countries but globally too.

The goods targeted include typical American products like bourbon, peanut butter, and orange juice, in a way that seems designed to create political pressure on U.S. President Donald Trump and senior U.S. politicians.

Canada and Mexico have also announced their own similar countermeasures just as an even greater trade skirmish pitting the usa against China deepens. President Trump imposed tariffs of 25 percent on steel imports and 10 percent on imported aluminum from the European Union on June 1.

The EU retaliatory tariffs will initially target a list of U.S. goods worth 2.8 billion euros (3.24 billion dollars), most of which will be hit with import duties of 25 per cent.

"What we have to do is create an environment where it's more painful for these parties that have these huge trade barriers, both tariff and non-tariff; got to make it more painful for them to keep those barriers than to get rid of them", U.S. Commerce Secretary Wilbur Ross told broadcaster CNBC on Thursday.

Canada has announced it will impose retaliatory tariffs on C$16.6 billion (RM50 billion) worth of United States exports from July 1.

Mexico has already announced its own tariffs on USA goods, and Canada's tariffs on almost $13 billion of United States products are set to take effect next month.

The EU also has in reserve potential tariffs of 10 per cent to 50 per cent that it could impose on a further €3.6 billion of U.S. imports in three years.

The tariffs, which took effect at midnight, further fuelled jitters on world stock markets that were already alarmed by trade tensions between the United States and China.

Trump has also imposed tariffs on other trade partners as well, slapping another 25 per cent tariff on $50 billion worth of Chinese goods last week.

However, China accused the U.S. of an act of "extreme pressure and blackmail" and said it would respond with "strong countermeasures".

That hands the Chinese side room to impose penalties such as Customs delays, tax audits and increased regulatory scrutiny.

Earlier this week, Mr Trump threatened to impose 10% duties on an additional $200bn (£150bn) worth of Chinese goods which he said would come into force if China "refuses to change its practices".

Other reports by Click Lancashire

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