US President Donald Trump said the EU’s trade policies against the US were worse than China’s in a speech in the New York on Tuesday.
US President Donald Trump will decide whether to impose tariffs on European Union (EU) automobile and auto parts by Wednesday as he steps up his highly charged rhetoric against EU trade policies.
“Many countries charge us extraordinarily high tariffs or create impossible trade barriers,” said Trump at a venue in New York on Tuesday. “And I’ll be honest, the European Union, very, very difficult. The barriers they have up are terrible, in many ways worse than China.”
Trump has until the end of Wednesday to enact tariffs that the EU says has no validity. The US government stated that tariffs were needed to be put in place to nurture research and development in the US manufacturing sector for the sake national security.
“United States defense and military superiority depend on the competitiveness of our automobile industry and the research and development that industry generates,” said the White House in a statement in May when the EU tariffs were first suspended for six months.
EU Trade Commissioner Cecilia Malmstrom categorically denied the US premise that tariffs were needed in order to protect US national security and deemed it illegal.
“We completely reject the notion that our car exports are a national security threat,” said Malmstrom in a tweet when tariffs were postponed in May. “The EU is prepared to negotiate a limited trade agreement incl cars, but not WTO-illegal managed trade.”
The tariff would spell trouble for EU’s manufacturing sector that has our brought down Europe’s largest economy, Germany, into recession.
Bundesbank, Germany’s central bank, said the economy slipped into technical recession in September due to a major slump in the automobile manufacturing sector.
“Early indicators currently provide few signs of a sustainable recovery in exports and a stabilization of the industry,” stated the Bundesbank report. German’s key car manufacturing sector has slumped from the start of this year due to lack of overseas demand, according to the central bank.
If the EU automobile tariffs are enacted, it will add onto other tariffs Trump slapped on EU goods valued at $7.5 billion last month.
The US tariff list included 25 percent duties on Irish and Scotch whiskies, German tools and machinery, German and Spanish cheeses. Most significantly, the US will slap 10 percent tariffs on airplanes manufactured in France, Germany, Spain, or the UK.