EU threatens US with $20 billion tit-for-tat tariffs

STOCKHOLM-Agence France-Presse

The EU is mulling tit-for-tat tariffs of around $20 billion on U.S. products if Washington goes ahead with its threat of new tolls on European cars, the bloc’s trade commissioner said on July 25.

“We hope that this won’t happen and that we can reach a solution. If not, then the European Commission will prepare a long list on American goods. It would amount to around $20 billion,” Cecilia Malmstrom told the Swedish daily Dagens Nyheter (DN).

She said the U.S. goods would include machinery, agricultural and high-tech products, among others.

Her comments came as U.S. President Donald Trump was set to meet with European Commission President Jean-Claude Juncker in the U.S. capital for talks over a festering trade dispute between the two key economies.

Trump, who has threatened to impose tariffs on European autos and auto parts, said it was his tough stance that brought the European leader to the bargaining table.

Juncker, who reiterated that Brussels would retaliate if Trump goes through with the measures, told German public broadcaster ZDF on July 25 that the EU is “not in the dock -- we don’t need to defend ourselves.”

“We don’t know any other strategy than dialogue,” said Malmstrom, who is currently in Washington with Juncker.

“We will explain that the EU is not a foe but a friend and an ally. We and the US share same view that the World Trade Organization must modernize,” she told DN.

Trump is facing increasing criticism as consumers, farmers and businesses are taking a hit from the retaliation to the raft of U.S. tariffs on steel, aluminum, and tens of billions of dollars in products from China that he has imposed in recent weeks.

Republican Senator Ben Sasse, a frequent Trump critic, said the president’s trade policies recalled a past of perilous economic instability.