The European Union said it would impose tariffs against U.S. imports in retaliation for new American duties, measures the bloc has already indicated will target consumer, agricultural and steel products in many key Republican constituencies.
The Trump administration announced on May 30 that it would hit the EU, Canada and Mexico with 25% duties on imported steel and 10% on aluminum in Washington’s most aggressive trade action yet against its allies.
The EU has said it will impose retaliatory tariffs on 2.8 billion euros (US$3.3 billion) of American imports as soon as June 20.
“The U.S. now leaves us with no choice but to proceed with a WTO dispute settlement case and with the imposition of additional duties on a number of imports from the U.S.,” European Commission President Jean-Claude Juncker said. “We will defend the Union’s interests, in full compliance with international trade law.”
Harley-Davidson Inc. and bourbon are both on the bloc’s list of goods that could be hit, pressuring Republican speaker of the House of Representatives Paul Ryan, who hails from the Wisconsin home of the motorcycle maker, and Senate Majority Leader Mitch McConnell, from Kentucky, where the whiskey is made.
“We support free and fair trade and hope for a quick resolution to this issue,” the bike maker said in an emailed statement. “A punitive, retaliatory tariff on Harley-Davidson motorcycles in other major markets would have a significant impact on our sales, our dealers, our suppliers and our customers in those markets.”
Washington put its levies in place in the name of protecting national security, an assertion members of the EU have dismissed.
“We are deeply disappointed that the U.S. has decided to apply tariffs to steel and aluminum imports from the EU on national security grounds,” the U.K. government said. “We have made clear to the U.S. Government at the highest levels the importance of U.K. steel and aluminum to its businesses and defense projects.”
The dispute is likely to dominate a meeting of finance ministers from the Group of Seven nations in Canada. The U.S. has just slapped tariffs on five of it six counterparts, including the host.
Prime Minister Theresa May will raise the matter with Trump at a subsequent summit of G-7 leaders next week, also in Canada.
Germany “rejects the tariffs imposed by the U.S. on steel and aluminum,” Steffen Seibert, Chancellor Angela Merkel’s chief spokesman, said in emailed statement.
“We consider that this unilateral measure is unlawful and that the national security concerns given as the reasons can’t be upheld,” Seibert said. “The measures instead carry the risk of creating a spiraling escalation that will harm everyone.”
French officials said the EU isn’t seeking a trade war with the U.S. but has no choice but to impose “re-balancing” tariffs on selected U.S. exports. The finance ministry officials, who asked not to be identified in line with government rules, said it was hard to envision talks happening with the tariffs in place.
By Richard Bravo