France: Europe will strike back in case of new US tariffs


"If the US hits us again with a 20 percent tariff on automobiles, we will respond again," French Finance Minister Bruno Le Maire told journalists in Paris on Monday 25 June 2018

AFP said that French Finance Minister Bruno Le Maire threatened that the European Union will retaliate again if US President Donald Trump imposes more tariffs on EU goods to remedy what he calls "unfair" trade relations.

The EU on 22 June imposed a range of tariffs on goods worth 2.8 billion euros ($3.3 billion) in a tit-for-tat response to Trump's decision to apply stiff tariffs on European steel and aluminium exports.

In response Trump threatened on Twitter to slap a 20 percent tariff on European car imports, heightening worries of a trade war which could dent growth on both sides of the Atlantic.

"If the US hits us again with a 20 percent tariff on automobiles, we will respond again," Le Maire told journalists in Paris.

"We don't want this to escalate, but we're the ones being attacked," he said.

The EU tariffs, applied to items ranging from blue jeans to bourbon, appear designed in part to hit industries which are predominantly active in states dominated by Trump's Republican Party.

"We want President Trump to change his mind. So it's legitimate for us to use every method at our disposal to make Mr Trump understand that we do not accept his decision," Le Maire said.

"If the penalties hit Republican states, and if that can make Republicans understand that this policy is unacceptable, so much the better."

Le Maire also said the trade dispute underscored the importance of deeper integration in the eurozone, which would foster stronger companies that could better compete on the global stage.

Yet eurozone members remain sharply divided on the French-German agreement announced this month including proposals such as a common budget and a move to harmonise corporate taxes.

The competing visions will clash at a EU summit in Brussels this week, with the Netherlands leading a charge to scupper the budget plan.

Trump this week is due to launch the next phase of his economic confrontation with Beijing, with new restrictions possible on Chinese investments to clamp down on access to sensitive American technologies.

That could open US firms like Apple and General Motors up to new forms of retaliation from China and experts worry it also marks another step in government intervention in the free market, a "radical departure" for the United States that could prove mutually destructive.

But contradictory statements Monday from senior US officials have muddied the waters on what path the White House will take.

Meanwhile, Trump has threatened to strike back against China's retaliation to the US tariffs that are due to take effect July 6 -- potentially escalating the tariffs to $450 billion in Chinese goods.

The American Treasury Department is due to unveil a proposal on investment and export restrictions.

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