Asian markets tumble as China-US trade tensions rise

EU is possibly as bad as China’ Trump attacks partners in new ‘unfair trade’ rant

Francois Lenoir Reuters

The president is also threatening to impose tariffs on imported vehicles and auto parts on the grounds that they pose a threat to America's national security.

President Donald Trump cited national security concerns for the previous tariffs. On Sunday, Canada started billions of dollars in retaliatory tariffs against the US, in a tit-for-tat response to the Trump administration's duties on Canadian steel and aluminum.

"In 2017, US-based European Union companies produced close to 2.9 million automobiles, which accounted for 26% of total United States production", it said, adding that they supported 120,000 U.S. jobs.

"It is awful what they do to us", Trump said in a television interview Sunday, citing trade deficits and "the auto situation".

USA manufacturing expanded more than forecast last month as a gauge of supplier-delivery times shot up amid robust orders and production, data from the Institute for Supply Management showed on Monday. The Trump administration suspended its tariffs after Beijing agreed to increase its purchases of US goods, especially in agriculture and energy.

The impact of retaliatory measures by Washington's trading partners could total around $294 billion - or around 19 percent of total US exports in 2017, the European Union estimates.

Canada, a member of the North American Free Trade Agreement (NAFTA) with the United States and Mexico, on July 1 imposed retaliatory measures on C$16.6 billion ($12.63 billion) of American goods, including coffee, ketchup and whiskey.

"No one has asked for protection under our laws protecting against fairly traded imports, for the simple reason that our industry is thriving".

Motorcycle maker Harley-Davidson said earlier this week that new tariffs imposed by Europe on certain manufactured goods will cause a "tremendous cost increase" that the company will have to shoulder.

When the US Census Bureau published the latest statistics showing the discrepancy in trade between the United States and China, it didn't make for happy reading. Any retaliatory measures by other countries will be much larger than what's happening with steel and aluminum tariffs, and will close off those markets to USA companies, ACC said. The $380 million plant opened in January, days before President Donald Trump levied tariffs on imported washers and some parts. The company fears that the increase in price for circuit boards and other Chinese-built components will have the "very real potential of forcing us to lay off workers and could (in a worst case scenario) require us to move some, if not all, of our manufacturing overseas".

Trump has previously been persuaded to back off of trade threats with the argument that states that backed him in the 2016 presidential campaign will be hard-hit.

According to the chamber's analysis, tariffs on China could threaten $2.35 billion in passenger vehicle exports and $109 million in gearbox exports. Some items will be subject to taxes of 10 or 25 percent. If EU countermeasures on automotive tariffs take the same approach as those on steel, they will amount to around €10 billion.

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