Trump escalates trade war, pledges more tariffs after EU, Canada's response

US President Donald Trump pledges more tariffs after his government's 25 per cent tariffs on all steel and aluminium imports invited retaliatory action from the European Union and Canada.

 

According to a BBC report, Trump said "of course" about his response to the counter tariffs, repeating his warning to reveal "reciprocal" tariffs next month on countries around the world. "Whatever they charge us with, we're charging them," he said.

 

The latest decision has marked an escalation in the already heated trade war between the US and other nations. The financial markets are also witnessing the impact of the trade war amid concerns over its impact on the economies and consumers in different countries worldwide.  

Countries reaction to Trump's steel and aluminium tariffs

 

On Wednesday, Trump's proposed 25 per cent tariffs on all steel and aluminium imports coming to the US came into effect. Following Trump's announcement, countries responded to the impact this decision would have. While India's steel secretary downplayed the impact on the domestic market, the European Commission and Canada hit back with retaliatory tariffs. 

 

The European Commission has imposed tariffs on US goods worth $28 billion and it would come into effect on April 1. 

Canada imposed 25 per cent tariffs on several US products worth $29.8 billion, including steel, computers, and sports equipment. 

 

Mark Carney, Canada's prime minister-designate stated that he was ready to ''negotiate a renewed trade deal with Trump, as long as there is respect for Canadian sovereignty."  Canada's tariffs on US goods will come into effect starting today and range from a wide variety of goods including umbrellas to imitation jewellery and kitchenware items, and many more items. 

Trump responds to trade war

 

Trump met Irish Prime Minister Taoiseach Micheál Martin at the White House on Wednesday, during which he made it clear that "he does not plan to back down from his trade fight," further adding that he was "unhappy" with European Union's trade policies. Citing concerns over legal penalties charged on tech giant Apple, he also called out the rules that put US farm products and cars at a disadvantage. 

 

"They're doing what they should be doing perhaps for the European Union but it does create ill will," he said, repeating his rhetoric to impose tariffs on European cars.

US heading to recession?

 

While Trump promised Americans that imposing tariffs on steel and aluminium imports would help in creating factory jobs in the US, and he wanted to boost the production of the two metals in the long run, experts believe that the taxes on these imports will raise the cost of both consumer and industrial products for the consumers in the immediate, thereby, denting the country's economic growth,  the BBC report added.