EU leaders warn the US to retaliate against higher tariffs on imported cars if imposed

In a summit meeting on Thursday night, June 28, 2018, the European Union leaders slapped the United States with a warning of retaliation should the Donald Trump escalate a trade war with 20 per cent higher tariffs on imported cars from the EU.

The EU leaders strictly criticised US’ decisions to impose tariffs on imported aluminium and steel products and repeatedly expressed support for the bloc’s retaliatory action over those levies, which Trump justified on national security grounds.

"In reaction to the United States' decision to impose tariffs on the EU for steel and aluminium products, which cannot be justified on the grounds of national security, the European Council fully supports the rebalancing measures, potential safeguard measures to protect our own markets, and the legal proceedings at the WTO, as decided on the initiative of the Commission," read the summit conclusions issued on early Friday.

It added, “The U.S. duties of 25 percent on steel and 10 percent on aluminium cannot be justified on the grounds of national security.” “The EU must respond to all actions of a clear protectionist nature, including those calling into question the Common Agricultural Policy."

The European Union view the US’ additional tariffs on imported steel and aluminium, imposed on 1^st of June, as nothing but “pure protectionist” and thus, levied retaliatory tariffs on a list of US products worth of 2.8 billion euros (US$3.26 billion), ranging from motorcycles to orange juice, with effect from 22^nd of June, 2018.

In response to this, Trump threatened to impose higher tariffs on cars imports from the EU, which if put into place, would hit the EU harder and Germany in particular than the metal tariffs did.