EU Ready with USD 20 Billion Worth of Retaliatory Levies if Trump Imposes New Car Import Tariffs

EU Ready with USD 20 Billion Worth of Retaliatory Levies if Trump Imposes New Car Import Tariffs

The European Union is ready to impose retaliatory levies on USD 20 billion of American-made goods if US President Donald Trump goes ahead with his plan to slap higher import tariffs on EU cars, a European Commissioner has warned ahead of Wednesday’s Trump – Juncker meeting in Washington.

European Commission President Jean-Claude Juncker is due to meet with Donald Trump in the US capital in a bid to avoid an all-out trade war between the EU and the United States, against the backdrop of the US President styling the European Union a “foe” because of its trade policies.

Trump’s previous threats to introduce higher levies on imported cars from the EU have led the EU to react by threatening to hit back US exports worth USD 294 billion with tariffs.

German Chancellor Angela Merkel is one of the many voices to have pointed out that the US actually enjoys a positive balance with the EU when services are counted in.

Hours before the Trump – Juncker meeting in D.C., EU Trade Commissioner Cecilia Malmstrom said she hoped the two leaders would reach an agreement to avoid the car tariffs.

However, just in case, the EU is readying its own tariffs worth USD 20 billion (EUR 17 billion) as a retaliatory measure.

“We hope that it doesn’t come to that and that we can find a solution. If not, the EU Commission is preparing a rather long list of many American goods. It would be around USD 20 billion,” Malmstrom told Swedish newspaper Dagens Nyheter, as cited by DW.

In her words, the next round of retaliatory EU tariffs could include agricultural products, machinery and high-tech products. However, the EU Commission insisted that they would not target specific US states.

Malmstrom is traveling with EU Commission President Juncker to Washington for his meeting with Trump.

Formal countermeasures by the EU could be expected only after the US Commerce Department concludes its investigation ordered by Trump on whether the imports of EU-made cars threaten America’s national security.

The US Department of Commerce report is expected to be published in August or September even though its formal deadline is February 2019.

Meanwhile, Heiko Maas, the Foreign Minister of Germany, which is the largest EU exporter of cars to the US, sought to differentiate between Trump’s views and policies and Germany’s partnership with America.

“For me, the US is not an adversary but rather our most important partner and ally outside the EU,” Maas wrote on Twitter.

“America is bigger than the White House. Trump won’t change that — he can tweet as much as he wants,” he added.

(Banner image: Flickr)

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