Today, the United States has imposed tariffs on a record of $7.5 billion of European Union goods despite threats of retaliation, with Airbus, Scottish whiskies and French wine among the high-profile targets.
The announcement comes after talks between European officials and US trade representatives failed to win a last-minute reprieve. The tariffs came to effect just after midnight in Washington (0401 GMT).
The World Health Organization (WTO)-endorsed onslaught from US President Donald Trump also comes as Washington is involved in a trade war with China and it may further risk the global economy.
Civilian aircraft from Britain, France, Germany, and Spain, the countries formed Airbus will now cost 10 percent more when imported to the US. Consumer products such as French wine, that Trump had vowed to target in recent months, will also get targeted by the tariffs.
France’s Economy Minister Bruno Le Maire while speaking in Washington hours before the tariffs were due to come into effect, warned the move may have serious consequences.
He told reporters “Europe is ready to retaliate, in the framework of course of the WTO,” after meeting with US Treasury Secretary Steven Mnuchin on the sidelines of the International Monetary Fund annual meetings.
“These decisions would have very negative consequences both from an economic and a political point of view.” He further claimed that the US against initiating another front in its trade conflicts and again called for a negotiated resolution.
At a time when the global economy is slowing, “I think that our responsibility is to do our best to avoid that kind of conflict,” Le Maire stated.
Regarding the issue, the Europeans have long advocated negotiation and they themselves will be able to impose tariffs next year to punish the United States for backing Boeing.
In July, the EU officials had proposed to call a truce on subsidies for planemakers, in which both sides would admit fault and agree to reduce state support to no avail. The two sides have been involved in a row over the subsidies for 15 years.
The US President on Wednesday singled out the Europeans for being unfair with the US over trade but said he is ready to negotiate to come to a settlement. On the other side, the Europeans are speculating that Trump may impose heavy duties on imports of European cars around mid-November. This may have a serious impact on the German automotive sector in particular, even if giants such as Volkswagen or BMW gets manufactured in the US.