US TRADE WAR: Merkel and Macron FAIL to change Trump's mind – EU prepares sanctions
During separate meetings with the US President, both European leaders pushed for an exemption from the new import tariffs of 25 percent on steel and 10 percent on aluminium set to be imposed on May 1, after the temporary exemption issued in March.
The EU will take a massive hit to its export industries if the bloc’s €6.4 billion of metals sent to the United States faces tariffs.
EU nations will put its own duties on €2.8 billion of US exports of products including everything from make-up to motorbikes in response to the action.
Germany’s transatlantic coordinator Peter Beyer said that, for Germany, even an extension of the exemption would be a success, but warned, “we should not put too much hope in that”.
He told the daily Rhein-Neckar Zeitung: “Given the many crises and conflicts, the expectations around this visit by the chancellor were far too high.”
The EU is now gearing up to impose its own countermeasures with speculation mounting that Jean-Claude Juncker, the European Commission president is set to deliver tit-for-tat duty hikes on Levi’s jeans, Harley-Davidson motorbikes and bourbon.
In one last throw of the dice before the May deadline, EU trade chief Cecilia Malmstrom will put Europe’s case to be permanently exempted from US tariffs for a final time later today.
In a bid to ward off a potential trade war, European Trade Commissioner Malmstrom will talk with US Commerce Secretary Wilbur Ross by phone in a last ditch effort to persuade Washington to change its mind.
Commission spokesman Margaritis Schinas told a news conference: “The only thing that I can tell you today is that we are patient but we are also prepared.”
Last month the Russian-German Foreign Trade Chamber warned that the total losses to German companies from US President Trump’s sanctions on Russia alone could hit €1.5bn.
After a survey of 154 companies the report said: “Short-term losses are estimated by the survey participants in the current fiscal year in the hundreds of millions of euros, and may amount to €377m.
“The medium-term losses will amount to at least 0.82 billion euros, according to conservative estimates. In the worst scenario, it may total almost 1.5 billion euros.”
The lack of impact from the back-to-back meetings of Chancellor Merkel and French President Macron are a further indication that that the US-European partnerships forged after World War II are changing.
Mrs Merkel said on Friday: “Germany and Europe will take more of its destiny into its own hands, because it’s no longer the Cold War era.”
While Constanze Stelzenmüller, a fellow at the Brookings Institution told Bloomberg: “I think at this point a sense of realism has set in on both sides, and a determination to do whatever is possible to keep the relationship afloat because the stakes are so big.”
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