Trump’s MAGA policy remains unchanged as EU warns to impose additional retaliation tariffs on US products

Participation of Jean-Claude Juncker, President of the EC, at the G7 Summit, in Canada
Giuseppe Conte, Donald Trump, Jean-Claude Juncker
Date: 08/06/2018. Location: Canada. © European Union , 2018 Photo: Etienne Ansotte

EU threatened the US last Friday with tariff measures on 294 billion dollars of US exports in case Donald Trump’s administration imposes import tariffs on cars and car parts. The US president seems to be doing whatever possible to cause trade wars all over the world.

The Old Continent will continue attempting to persuade Mr Trump to change the America’s First policy and find a fair trade deal for all. Prime Minister Rutte of the Kingdom of the Netherlands was the first EU leader to have visited the White House in order to discuss on trade, among other topics, between the EU and US. Furthermore, the president of the European Commission plans to meet the US president to reverse the trade tensions between the two nations.

EC president’s uncertainty

Jean Claude Juncker mentioned last Friday that will accept the invitation of Mr Trump to travel to Washington by the end of the month. The intention of the EC president is to try convincing the US president to change his trade policy adding to what has already been said at the G7 summit in Canada last month. More specifically, Mr Juncker stated: “I will travel to Washington before the end of July. In summary, I will be presenting what I said to Mr Trump at the G7 summit in Canada. If you add everything together – trade in goods, profits made by American multinationals in Europe and services – then the balance is completely different. Because then we will have a deficit and not our American friends. We’re going to do all that again in Washington. When it comes to Europe we have to show that we exist, that we are united and that we are presenting – member states, the Commission, the president of the Council – the same view.”

However, the EC president is very pessimistic that the US administration will change the current offensive trade policy towards Europe and the rest of the world. According to Mr Junker, the bloc should insist on the retaliation measures in order to protect its economies.

EU threatens US exports

In a written submission to the US Department of Commerce seen by the Financial Times, the EU has shown its intentions to implement countermeasures worthy of 294 billion dollars of US exports in a clear attempt to oppose to the tariffs which have already or will be imposed by the US. This move comes after the warning by the US president to impose a 20% tariff on all U.S. imports of European Union-assembled cars.

What is more, the aforementioned possible action “could result in yet another disregard of international law”, create bad reputation for the US internationally and damage the global economy according to the European Commission’s document.

Rutte says “no” to Trump

The Prime Minister of the Netherlands met US president in the White House last Monday where both leaders talked over trade. Mr Trump mentioned that the EU wants to close a deal and it will be positive if it will be done but it will be also positive if it will not be done. The response was immediate by Mark Rutte who stated that it will not be positive if the US and EU will not come to a common agreement and both parties have to act in this direction.

The White House doesn’t seem to change its policy, especially on trade, targeting all countries with punitive tariffs. More in detail, the US president said last Sunday focusing on the car situation: “The European Union is possibly as bad as China, just smaller . . . It is terrible what they do to us”.

But Trump’s MAGA (Make America Grear Again) is also aiming at the World Trade Organisation (WTO). According to a recent statement, it is said that the WTO has not treated the US in a fair way and has created an alliance with the EU against the United States.

All in all, the attempt of the EU to negotiate on trade with the US and particularly with President Trump is most likely going to be in vain. As the current situation evolves together with the fact that EU and China will not leave this unanswered, one thing is for sure; the MAGA policy is about to cause a global disorder.