Tuesday July 24, 2018
France and Germany acknowledge the escalating nature of an emerging “trade war” with Washington; the US now stands alone against China.Commenting on tariffs, Merkel said there is a danger the Euro-Atlantic partners will “hurt each other” and will have far-reaching consequences for the world.
During the G20 summit in Buenos Aires, the French Finance Minister Bruno Le Maire warned his counterparts that Washington is moving towards the “law of the jungle” in international trade.
Le Maire described “trade war” as a reality and called for an end to punitive tactics. The French minister reiterated on Saturday that the EU will not negotiate with Washington while US tariffs remain in place.
From Berlin, the German Chancellor Angela Merkel said on Sunday that Washington can no longer be relied upon to deliver world order. “We can’t rely on the superpower of the United States,” Merkel said. However, she did vow to work for the “crucial” Euro-Atlantic relationship.
From Buenos Aires, US Treasury Secretary Steven Mnuchin called on both the EU and China to open their markets to free competition, “with no tariffs, no non-tariff barriers and no subsidies.”
The Trump administration has imposed a 25% import tariff on steel and 10% on aluminium, without exemptions. He has also withdrawn from the Trans Pacific Partnership, wants a renegotiation of the North American Free Trade Agreement and is undermining the World Trade Organization. According to numerous media reports, he is repeatedly threatening US withdrawal.
Warning about the bottom line effect of an escalating Euro-Atlantic trade war, the chief of the International Monetary Fund Christine Lagarde is warning that it may cost the global economy $430bn, even as the global GDP is surging by 3.9%.