U.S. launches five WTO challenges to retaliatory tariffs

Cheryl Sanders
July 17, 2018

Trump's slapping of tariffs on steel and aluminum as well as threats of new duties on the automotive industry, have unnerved Washington's trade partners throughout Europe, particularly Germany.

Over the past decade, about 20 per cent of China's exports have gone to USA markets, according to Moody's Investors Services, with exports still accounting for a sizeable chunk of the giant economy.

Tusk called on China, the United States and other countries to not start trade wars and to reform the World Trade Organization so it is equipped to combat forced technology transfers and government subsidies, complaints underpinning Trump's tariffs.

The Trump administration has criticized the WTO for encroaching on us legal sovereignty and failing to rein in China's alleged violation of global trading rules.

"There is still time to prevent conflict and chaos".

Later, at a business forum, he said, "We need just and fair multilateral rules".

Mr Juncker was accompanied by the President of the European Council, Donald Tusk, who warned that worsening trade tensions could lead to conflict.

Washington raised the stakes this week by threatening to impose fresh tariffs on another US$200 billion in Chinese goods, with Beijing vowing it would retaliate once again.

"Europe and China, America and Russian Federation, today in Beijing and in Helsinki, are jointly responsible for improving the world order, not for destroying it", Tusk said in a separate tweet.

"On the contrary, the solid trade relationship between Mexico and the USA has created an integrated regional market where steel and aluminum products contribute to the competitiveness of the region in various strategic sectors, such as automotive, aerospace, electrical and electronic", the ministry added. The EU and Canada in particular note that they are longtime allies and that their exports to the US can not be considered a national security threat.

Beijing's "Made in China 2025" initiative, an ambitious plan to close the Asian giant's technology gap with the West, is also viewed as exploitative by many in the EU.

"Given the complicated and fluid global landscape, it is important for China and the European Union to uphold multilateralism", said Li.

He has said he is willing to raise duties on more than 500 billion dollars (£377 billion) of imports, or nearly everything Americans buy from China.

Beijing has stepped up diplomatic efforts to recruit support from Europe, South Korea and other trading partners, so far without success.

In the runup to the summit, Tusk delivered a blunt message to Trump to stop criticizing European allies.

"Our summit is not directed at any third party", said Li.

He echoed European Union calls for a reform of the WTO and agreed to form a joint working group on the issue.

Li has appealed to visiting European leaders including German Chancellor Angela Merkel in May by saying their companies were welcome to invest.

Chinese leaders have tried to defuse foreign pressure by promising foreign companies better treatment without changing their industrial development strategies.

"The EIU is more concerned about slowing domestic demand within China's economy, with investment persistently weak and consumption also having slowed, and these are much more important drivers of growth than exports", he said in a research note.

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