Consequences could be catastrophic: EU Commissioner on US-EU trade war
Photo: Valdis Dombrovskis (Vitalii Nosach/RBC-Ukraine)
A global trade war between the US and the EU could have severe consequences. The European Union opposes raising tariffs but is prepared to respond to Donald Trump's actions proportionally and firmly, RBC-Ukraine reports, citing EU Commissioner for Economy and Productivity Valdis Dombrovskis.
A global trade war between the US and the EU could have severe consequences. The European Union opposes raising tariffs but is prepared to respond to Donald Trump's actions proportionally and firmly, RBC-Ukraine reports, citing EU Commissioner for Economy and Productivity Valdis Dombrovskis.
"Well, first of all, we believe that this kind of trade escalation serves no one's interest, neither European economy nor US economy itself," Dombrovskis said in response to an RBC-Ukraine question about how dangerous a global trade war between the US and the EU could be.
EU Commissioner also noted that, according to International Monetary Fund estimates, if such a global economic fragmentation occurs and trade is concentrated within separate blocs, it could lead to a medium-term decline in global GDP by 7%.
"It's like taking Germany and France's combined economies out of the world map. So it can have substantial negative impact," Dombrovskis noted.
The EU’s response
When asked by RBC-Ukraine how united the EU is in its readiness to respond to US threats of imposing massive tariffs on European goods, Dombrovskis said:
"So from the EU side, we are committed to multilateral rules-based trading system and engaging to prevent escalation of trade tensions. At the same time, the US has already imposed tariffs on EU steel and aluminum and we have been very clear from EU side that we will be responding in a proportionate way."
According to him, the first package of EU countermeasures will take effect on April 1, with the next package planned for mid-April.
"That has been our signal to US authorities that should there be further escalation of tariffs against EU, EU will be responding in a proportional but firm way," Dombrovskis added.
As previously reported, Trump, after returning to the White House, launched trade wars with US allies - Canada, Mexico, and the EU. In particular, he imposed 25% tariffs on steel and aluminum from the EU. In response, Brussels introduced its own tariffs on American goods worth €26 billion.
