US President Donald Trump has intensified the ongoing trade war by pledging additional tariffs in response to retaliatory measures from the European Union (EU) and Canada. His latest move follows the imposition of steep import taxes on steel and aluminum, which sparked global backlash.
Trump reaffirmed his stance, warning that the US would implement "reciprocal" tariffs next month. "Whatever they charge us with, we're charging them," he declared, signaling further economic confrontations.
The escalation has rattled financial markets, raising concerns about its potential repercussions on global economies and consumers, including those in the US.
On Wednesday, the US moved forward with a 25% tariff on steel and aluminum imports, eliminating previous exemptions for certain countries. This follows earlier measures increasing duties on Chinese goods by at least 20%.
Trump has also hinted at additional tariffs on specific imports such as copper, lumber, and automobiles. In response, Canada and EU leaders denounced the tariffs as unjustified and implemented their own countermeasures. Canada imposed a 25% duty on nearly C$30 billion ($20 billion) worth of US goods, while the EU announced levies on €26 billion ($28 billion) worth of American products, including bourbon, boats, and motorbikes.
UK Prime Minister Sir Keir Starmer expressed disappointment over the tariffs but emphasized a pragmatic approach, stating that negotiations on trade agreements remain ongoing.
EU President Ursula von der Leyen described the bloc’s response as "strong but proportionate," stressing that tariffs harm both businesses and consumers. "Nobody benefits from this—neither in Europe nor in the United States," she warned.
Trump argues that tariffs will bolster US steel and aluminum industries in the long run, but critics warn of immediate price hikes and economic slowdowns. Major food and beverage companies, including PepsiCo and Quaker Oats, have urged the administration to exempt key imports like cocoa and tropical fruits, which are not readily available from US sources.
The tariffs are expected to reduce global demand for non-US steel and aluminum, significantly impacting international producers. The EU estimates that US tariffs affect approximately 5% of its exports, while Canada sends nearly 90% of its steel and aluminum to the US.
US stocks showed mixed reactions, with the Dow declining by 0.2%, while the Nasdaq rose by 1.2%. In a White House appearance with Irish Prime Minister Micheál Martin, Trump reiterated his dissatisfaction with EU trade policies, accusing the bloc of unfair penalties on US businesses.
"They’re doing what they think is best for the EU, but it’s creating unnecessary tensions," he said, doubling down on his threat to impose tariffs on European automobiles. "We’re going to win this financial battle," he added, signaling no intention of backing down.
Source: BBC
BDST: 1008 HRS, MAR 13, 2025
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