EU warns US of boomerang effect if US imposes car levy

Oscar PerryJul 03, 2018

According to a report in the Financial Times, a letter sent by the European Commission to the US Department of Commerce says the EU could hit $300 billion - the equivalent of well over R4 trillion - of US goods with tariffs, if Trump follows through on his threats to place big taxes on European vehicles being imported in the US.

The European Commission, the EU executive that handles trade for the bloc, said on Monday it was trying to convince its USA counterparts that imposing such tariffs would be a mistake.

According to the report, the EU exported $43.6 billion worth of cars to the USA last year, while approximately $7.2 billion worth of cars went from the United States to the European bloc.

Mr Trump has already imposed heavy tariffs on European steel and aluminium imports, provoking retaliation in the form of tariffs on US.

The European Commission said in a letter that they would hit $300 billion of U.S. goods with tariffs if needed.

The bloc argues that for some goods, such as trucks, U.S. import duties are higher.

"The European Union is possibly as bad as China, just smaller", he told Fox News in an interview, adding that it was "terrible what they do to us" and then mentioning the "car situation". "Look what they do to our farmers". The EU had calculated that a 25% tariff would have an initial US$13-14 billion negative impact on United States gross domestic product with no improvement to its current account balance. "They treat us very unfairly". "But we don't protect ours and they protect theirs".

Belgium beat Japan at the death in last 16 thriller
Hanover's new signing at first hesitated on the right of the area before his angled shot went past Thibaut Courtois in goal. Vertonghen made amends for his error in the 69th minute, looping a header into the net to give his team hope.

Meanwhile, in a surreal twist to the trade war developments, Axios reported Sunday that a leaked draft Trump administration bill would see the US abandon the World Trade Organization (WTO) rules that limit the levels of tariffs that the country can impose on imports.

The U.S. has complained about Chinese policies that Washington said either forced companies to relinquish key technology or allowed China to steal it outright.

Additionally, the German manufacturer said that there is no correlation between USA national security and the domestic manufacture of automobiles.

Malmstrom said the European Union can not lift its auto tariffs for the United States or it would have to do so for the rest of the world, and "there's no way" European Union member countries would agree to that.

Assuming counter-measures along the lines of those taken in response to existing U.S. import tariffs on steel and aluminium, up to US$294 billion of United States exports - 19% of overall USA exports - could be affected, the submission said.

The EU retaliation came after Trump's administration on June 1 struck Europe as well as allies in Canada, Mexico and elsewhere with tariffs on aluminum and steel.

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