US President Donald Trump on Saturday announced he's levying tariffs of 30 per cent against the European Union and Mexico starting Aug 1, a move that could cause massive upheaval between US and two of its biggest trade partners.
Trump detailed the planned tariffs in letters posted to his social media account. They are part of an announcement blitz by Trump of new tariffs with allies and foes alike, a bedrock of his 2024 campaign that he said would set the foundation for reviving a US economy that he claims has been ripped off by other nations for decades.
In his letter to Mexico's leader, President Claudia Sheinbaum, Trump acknowledged that the country has been helpful in stemming the flow of undocumented migrants and fentanyl into US. But he said the country has not done enough to stop North America from turning into a "narco-trafficking playground".
"Mexico has been helping me secure the border, BUT, what Mexico has done, is not enough," Trump added.
Trump in his letter to the European Union said that the US trade deficit was a national security threat.
EU says it still wants US trade deal
"We have had years to discuss our Trading Relationship with The European Union, and we have concluded we must move away from these long-term, large, and persistent, Trade Deficits, engendered by your Tariff, and Non-Tariff, Policies, and Trade Barriers," Trump wrote in the letter to the EU. "Our relationship has been, unfortunately, far from Reciprocal."
The letters come in the midst of an on-and-off Trump threat to impose tariffs on countries and right an imbalance in trade. Trump in April imposed tariffs on dozens of countries, before pausing them for 90 days to negotiate individual deals. As the three-month grace period ended this week, Trump began sending his tariff letters to leaders but again has pushed back the implementation day for what he says will be just a few more weeks.
If he moves forward with the tariffs, it could have ramifications for nearly every aspect of the global economy.
European Union Commission president Ursula von der Leyen responded by noting the bloc's "commitment to dialogue, stability, and a constructive transatlantic partnership."
"At the same time, we will take all necessary steps to safeguard EU interests, including the adoption of proportionate countermeasures if required," von der Leyen said in a statement.
Von der Leyen added that the EU remains committed to continuing negotiations with the US and coming to an agreement before Aug 1. Trade ministers from EU countries are scheduled to meet Monday to discuss trade relations with the US, as well as with China.
European leaders joined von der Leyen in urging Trump to give negotiations more time and warnings of possible new tariffs on Washington. "With European unity, it is more than ever up to the Commission to assert the Union's determination to resolutely defend European interests," French President Emmanuel Macron said in a statement posted on X.
Italian Premier Giorgia Meloni's office said "it would make no sense to trigger a trade war between the two sides of the Atlantic".
European leaders had held out hope that they would avoid receiving a letter, and that a deal would be worked out. The bloc collectively sells more to the US than any other country.
US goods imports from the EU topped $553 billion in 2022, according to the Office of the US Trade Representative. Europe’s biggest exports to the US were pharmaceuticals, cars, aircraft, chemicals, medical instruments and spirits.
Trump has complained about the EU’s 198 billion-euro trade surplus in goods, which shows Americans buy more goods from Europe than the other way around. However, American companies fill some of the gap by outselling the EU when it comes to services such as cloud computing, travel bookings, and legal and financial services. With the reciprocal tariffs, Trump is effectively blowing up the rules governing world trade.
For decades, the United States and most other countries abided by tariff rates set through a series of complex negotiations known as the Uruguay round. Countries could set their own tariffs, but under the “most favoured nation” approach, they couldn’t charge one country more than they charged another
Trump detailed the planned tariffs in letters posted to his social media account. They are part of an announcement blitz by Trump of new tariffs with allies and foes alike, a bedrock of his 2024 campaign that he said would set the foundation for reviving a US economy that he claims has been ripped off by other nations for decades.
In his letter to Mexico's leader, President Claudia Sheinbaum, Trump acknowledged that the country has been helpful in stemming the flow of undocumented migrants and fentanyl into US. But he said the country has not done enough to stop North America from turning into a "narco-trafficking playground".
"Mexico has been helping me secure the border, BUT, what Mexico has done, is not enough," Trump added.
Trump in his letter to the European Union said that the US trade deficit was a national security threat.
EU says it still wants US trade deal
"We have had years to discuss our Trading Relationship with The European Union, and we have concluded we must move away from these long-term, large, and persistent, Trade Deficits, engendered by your Tariff, and Non-Tariff, Policies, and Trade Barriers," Trump wrote in the letter to the EU. "Our relationship has been, unfortunately, far from Reciprocal."
The letters come in the midst of an on-and-off Trump threat to impose tariffs on countries and right an imbalance in trade. Trump in April imposed tariffs on dozens of countries, before pausing them for 90 days to negotiate individual deals. As the three-month grace period ended this week, Trump began sending his tariff letters to leaders but again has pushed back the implementation day for what he says will be just a few more weeks.
If he moves forward with the tariffs, it could have ramifications for nearly every aspect of the global economy.
European Union Commission president Ursula von der Leyen responded by noting the bloc's "commitment to dialogue, stability, and a constructive transatlantic partnership."
"At the same time, we will take all necessary steps to safeguard EU interests, including the adoption of proportionate countermeasures if required," von der Leyen said in a statement.
Von der Leyen added that the EU remains committed to continuing negotiations with the US and coming to an agreement before Aug 1. Trade ministers from EU countries are scheduled to meet Monday to discuss trade relations with the US, as well as with China.
European leaders joined von der Leyen in urging Trump to give negotiations more time and warnings of possible new tariffs on Washington. "With European unity, it is more than ever up to the Commission to assert the Union's determination to resolutely defend European interests," French President Emmanuel Macron said in a statement posted on X.
Italian Premier Giorgia Meloni's office said "it would make no sense to trigger a trade war between the two sides of the Atlantic".
European leaders had held out hope that they would avoid receiving a letter, and that a deal would be worked out. The bloc collectively sells more to the US than any other country.
US goods imports from the EU topped $553 billion in 2022, according to the Office of the US Trade Representative. Europe’s biggest exports to the US were pharmaceuticals, cars, aircraft, chemicals, medical instruments and spirits.
Trump has complained about the EU’s 198 billion-euro trade surplus in goods, which shows Americans buy more goods from Europe than the other way around. However, American companies fill some of the gap by outselling the EU when it comes to services such as cloud computing, travel bookings, and legal and financial services. With the reciprocal tariffs, Trump is effectively blowing up the rules governing world trade.
For decades, the United States and most other countries abided by tariff rates set through a series of complex negotiations known as the Uruguay round. Countries could set their own tariffs, but under the “most favoured nation” approach, they couldn’t charge one country more than they charged another
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