Trump threatens tax on European cars if EU retaliates against tariffs

President Donald Trump's motorcade arriving at Trump International Golf Club in Florida last Saturday. He tweeted that he would hit back at European leaders who said they would retaliate against tariffs on aluminium and steel.
President Donald Trump's motorcade arriving at Trump International Golf Club in Florida last Saturday. He tweeted that he would hit back at European leaders who said they would retaliate against tariffs on aluminium and steel. PHOTO: NYTIMES

WASHINGTON • In his expanding war over global trade, President Donald Trump has aimed his harshest rhetoric at an unlikely target - the closest US allies.

In Twitter posts while at his Mar-a-Lago resort in Florida last Saturday, Mr Trump vowed to strike back at European leaders who said they would retaliate against his promised tariffs on aluminium and steel.

"If the EU wants to further increase their already massive tariffs and barriers on US companies doing business there, we will simply apply a Tax on their Cars which freely pour into the US. They make it impossible for our cars (and more) to sell there. Big trade imbalance!" he tweeted.

The country that escaped Mr Trump's tweeting ire was China, the very nation the President has wanted to hit hardest and the one that is largely responsible for flooding global markets with cheap steel.

The biggest burden of Mr Trump's new tariffs - 25 per cent on steel and 10 per cent on aluminium - would be borne by Canada, the largest trading partner with the US. The tariffs would also hit Britain, Germany, South Korea, Turkey and Japan, countries with which the United States has extremely close national security ties.

Certain exemptions could be made but exclusions for entire countries are not expected, top White House trade adviser Peter Navarro told CNN yesterday.

"There'll be an exemption procedure for particular cases where you need to have exemptions so that business can move forward, but at this point in time, there'll be no country exclusions."

Commerce Secretary Wilbur Ross said separately that Mr Trump had spoken to world leaders about the planned tariff hike.

Canada and the European Union have said they planned to retaliate.

Mr Jamie Fly, a senior fellow at the German Marshall Fund, said: "The administration is squandering the little credibility they had with transatlantic partners at a time when they are asking them to help fix the Iran deal, fight terrorism and increase defence spending. It will not work."

The new tariffs and the President's truculent rhetoric triggered angry responses.

"Allies should not be treated as scapegoats, Mr President," wrote a German Member of the European Parliament, Mr Reinhard Butikofer, on Twitter. "Or is it your goal to make America lonely?"

China, which had avoided any overt warnings of potential retaliation to the US tariffs, warned yesterday that it would hit back if the US damaged its economic interests.

"If the US takes actions that hurt Chinese interests, China will not sit idly by," Mr Zhang Yesui, a spokesman for the National People's Congress, told a news conference on the eve of the Parliament's annual session.

WASHINGTON POST, AGENCE FRANCE-PRESSE

A version of this article appeared in the print edition of The Straits Times on March 05, 2018, with the headline 'Trump threatens tax on European cars if EU retaliates against tariffs'. Print Edition | Subscribe