EU joins global battle against Trump tariffs

BRUSSELS • The EU fired its first riposte against Washington's punishing steel and aluminium tariffs yesterday, joining Canada and Mexico in a brewing global trade war against US protectionism.

Brussels followed its major allies into battle against the United States after President Donald Trump delivered on his "America First" promises and slapped duties of 25 per cent on imports of steel and 10 per cent on aluminium.

The European Union yesterday said it had opened legal challenges to the US at the World Trade Organisation, the Geneva-based arbitrator of international trade disputes that is loathed by Mr Trump.

The bloc also opened proceedings against China, the world's second-biggest economy, in a case involving intellectual property, in an effort to not single out the US, the EU said.

Brussels is also preparing to slap tariffs on US products including bourbon, motorcycles and blue jeans worth up to €2.8 billion (S$4.4 billion).

The US decided the tariffs in March, but gave Canada and the EU - the biggest sources of foreign aluminium and steel for the US - a grace period that ended on May 31.

The US move drew a string of furious responses from Canadian President Justin Trudeau, German Chancellor Angela Merkel and French President Emmanuel Macron.

Dr Merkel said the measure "risks touching off spirals of escalation that in the end hurt everyone".

Mexico, too, said it would impose retaliatory duties on a variety of US goods.

Mr Trump yesterday blasted Canada after Ottawa hit back with retaliatory duties on US imports worth up to C$16.6 billion (S$17 billion).

He also discussed addressing a trade imbalance with Europe in a phone conversation with French President Macron, who warned that Europe would respond in a "firm and proportionate manner".

Worries about the deepening trade tensions, however, were offset by a bullish report on the US economy.

The Labour Department reported that the US added 223,000 non-farm jobs last month, stronger than the consensus forecast of economists, and that unemployment fell 3.8 per cent, its lowest level in 18 years.

AGENCE FRANCE-PRESSE, REUTERS

A version of this article appeared in the print edition of The Straits Times on June 02, 2018, with the headline 'EU joins global battle against Trump tariffs'. Print Edition | Subscribe