Daily Trends Now
Daily Trends Now

Trade war: ‘Europe United’ as European Union and Mexico respond to USA tariffs

The head of the Canadian Chamber of Commerce called on Canada to retaliate against the USA move.

European and USA equities lost ground slightly on fears the United States measures could spark a trade war. President Donald Trump had announced the tariffs in March, citing national security concerns. Through the first three quarters of 2017, the USA ran a relatively minor trade deficit with Canada of about a half-million metric tons, according to Department of Commerce data. "This is protectionism, pure and simple", Juncker said.

While Thursday's action cheered American steel producers, companies that use imported metals said that it endangered U.S.jobs and investment.

Trump imposed the tariffs in March to address global oversupply of the metals, but though it was largely aimed at China it hit U.S. allies as well. It could also place the United States in a trade dispute on more than one front.

And so the administration chose to lift the exemption from the tariffs for those countries. And he said that while he was looking forward to continuing negotiations, the U.S.is making its decision in the interest of national security - a justification Foreign Affairs Minister Chrystia Freeland has dismissed as absurd.

Ross himself heads to Beijing on Friday where he will attempt to get firm deals to export more US goods in a bid to cut America's $375 billion trade deficit with China.

"Bad news that @POTUS has chose to impose taxes on American consumers buying steel and aluminum from our closest allies -Canada, the European Union, and Mexico (with whom we run a trade surplus on steel)", tweeted Sen. Talks with Europe had "made some progress" but not enough for additional exemptions, he said in a conference call from Paris.

"It's totally unacceptable that a country is imposing unilateral measures when it comes to world trade". On April 30, he extended for 30 days the temporary exemption from the steel and aluminum tariffs for Canada, Mexico and the European Union to allow for further negotiation.

In contrast to France, Germany - Europe's largest economy - has taken a milder tone since March, seeking to be a peacemaker in the negotiations, downplaying talk of retaliation and seeking to keep both sides talking.

Brazil, Argentina and Australia have agreed to limit steel shipments to the U.S.in exchange for being spared the tariffs, the Commerce Department said.

The metal tariffs on their own will not have much effect on Germany's heavily export-driven economy.

For the past couple of months, it has looked like a trade war might be avoided, Greg Valliere, chief global strategist at Horizon Investments, wrote in a note distributed early Thursday morning.

"As to Canada, Mexico, you will recall that the reason for the deferral had been pending the outcome of the NAFTA talks", he said.

"Our members could face having to pay double tariffs on some materials necessary to manufacture parts in the U.S.", said a statement from the Motor & Equipment Manufacturers Association.


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