United States President, Donald Trump on Wednesday threatened to escalate a global trade war with further tariffs on European Union goods, as major US trading partners said they would retaliate for trade barriers already erected by the US president.
A few hours after Trump’s 25% duties on all US steel and aluminum imports took effect, Trump said he would impose additional penalties if the EU follows through with its plan to enact counter tariffs on some US goods next month.
“Whatever they charge us, we’re charging them,” Trump said.
The president’s hyper-focus on tariffs has reportedly rattled investor, consumer and business confidence and raised recession fears.
Trump has also frayed relations with Canada, a close ally and major trading partner, by repeatedly threatening to annex the neighboring country.
Meanwhile, Canada, the biggest foreign supplier of steel and aluminum to the United States, announced 25% retaliatory tariffs on those metals along with computers, sports equipment and other products worth $20 billion in total.
Canada has already imposed tariffs worth a similar amount on US goods in response to broader tariffs by Trump.
“We will not stand idly by while our iconic steel and aluminum industries are being unfairly targeted,” Canada’s Finance Minister Dominic LeBlanc said.
In the same vein, Canada’s central bank cut interest rates to prepare for economic disruption.
Trump’s action to bulk up protections for American steel and aluminum producers restores effective tariffs of 25% on all imports and extends the duties to hundreds of downstream products, from nuts and bolts to bulldozer blades and soda cans.
According to the US Commerce Secretary Howard Lutnick, the president would impose trade protections on copper as well.