In a meeting with Irish Prime Minister Michael Martin on Wednesday (yesterday), Trump made statements regarding the European Commission's decision to impose additional tariffs on EUR 26 billion (about USD 28 billion) worth of US products as of next month.
Stating that they will respond to the EU's move, Trump declared, “Of course I will respond.” Emphasizing that they will protect the interests of the USA, Trump stated that Ireland has been attracting US-based pharmaceutical and technology companies with its low tax policies for many years. “Ireland has been very smart, but it's time to protect USA interests,” Trump announced, announcing that his country will impose new tariffs.
USA to Add 25% Additional Customs Duty on Steel and Aluminum
Trump administration imposed an additional 25% tariff on USA imports of steel and aluminum on Wednesday. While the decision was intended to protect domestic steel and aluminum producers, it increased global trade tensions. The new tariffs cover metals as well as hundreds of downstream products.
Canada, the largest supplier of steel and aluminum to the USA, quickly retaliated. The Canadian government announced an additional 25% tariff on USA products worth a total of CAD 29.8 billion, including computers and sporting goods. To offset the economic effects, the Bank of Canada cut interest rates.
EU Retaliates with EUR 26 Billion
The European Commission has decided to impose tariffs on EUR 26 billion (about USD 28 billion) worth of American products in response to US tariffs on steel and aluminum products. The new duties are expected to take effect from next month. The products targeted by the EU include agricultural products, automobiles and technology products. The European Commission said the move was a move to prevent a trade imbalance.
In response to the EU's decision to retaliate, Trump stated the USA could take tougher measures and expand tariffs to strengthen the USA economy.
Trump: “The US Economy Will Get Stronger”
Trump made a statement in the Oval Office, arguing that the USA economy will emerge stronger from the trade wars. Stating that the USA has suffered for years due to wrong trade policies, Trump said that the new taxes will support American production and compensate the USA for its losses.
“Those who want to buy goods from the US will now have to pay more taxes. Pharmaceutical companies and technology companies will come back to the US.This will be a big win for the US economy in the long run.” Trump predicted that the markets will react positively to these developments and that the USA economy will be strengthened by the new trade policies.
Global Impacts of Trade Wars Growing
The new USA tariffs and Trump's harsh statements have a direct impact on global trade balances. The USA increased tariffs on imports, prompting retaliation from major trading partners such as Europe and Canada. While this situation caused volatility in global markets, the long-term effects of the trade wars are expected to be felt more.
Economists say the trade war between the USA and Europe could widen and threaten global economic growth. If the trade wars deepen, it is predicted that there may be more severe price fluctuations, especially in the automobile and technology sectors.
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