Trump Preparing To Hit EU With Billions In Tariffs: Report
Washington is reportedly preparing to announce tariffs on billions of euros of goods from the European Union, following a confidential decision by the WTO that was just handed down on Friday, Politico reports, citing four anonymous EU officials.
According to these officials, the WTO ruled in favor of the US on Friday in a case against Airbus, ending a long-running transatlantic dispute between the world’s two largest aircraft manufacturers. It’s not the first finding against Airbus, an earlier ruling was released in April, which found that Airbus had benefited from illegal state subsidies.
The decision will open the door fo President Trump to slap the tariffs on goods ranging from cheese to aircraft components. One official reportedly said that Trump had won the right to collect between €5 billion and €8 billion in tariff revenues. Another said the maximum sum is closer to $10 billion.
This is terrible news for the market of course, since any sign that Washington is opening up a new front in the trade war could end the rally, just as markets were nearing new highs.
But a showdown between the incoming European Commission and the White House was probably inevitable, since most people expected that Trump was putting off his decision on tariffs until the new members of the European Commission were announced. That happened Tuesday.
On Tuesday, incoming Commission President Ursula von der Leyen signaled an aggressive approach to transatlantic trade. She has appointed incoming Trade Commissioner Phil Hogan, an Irish farmer, to lead trade negotiations with Washington.
Washington has indicated it would follow through with tariffs if it won the case in Geneva and has prepared a list of EU exports worth about $21 billion, they can choose any amount of products from the list.