Date
19 June 2018
Demonstrators burn US, Italian and British flags at a protest march during the G7 Summit in Quebec City, Quebec, Canada, on Thursday. Photo: Reuters
Demonstrators burn US, Italian and British flags at a protest march during the G7 Summit in Quebec City, Quebec, Canada, on Thursday. Photo: Reuters

Trump attacks EU and Canada on trade ahead of G7 summit

A day before he attends a summit of the Group of Seven rich nations in Quebec, US President Donald Trump said on Thursday that France and Canada charge the United States “massive tariffs” and have non-monetary barriers to trade, Reuters reports.

“Please tell Prime Minister Trudeau and President Macron that they are charging the US massive tariffs and create non-monetary barriers,” Trump said on Twitter, adding that he “looks forward to seeing them” on Friday.

In a bid to rebuild America’s industry, Trump has imposed hefty tariffs on steel and aluminum imports, including those from key G7 allies like Canada, Japan and the European Union.

Trump has threatened to use national security laws to do the same for car imports and has walked back on environmental agreements and an international deal to prevent Iran from building a nuclear bomb.

French President Emmanuel Macron, who has invested in a warm personal relationship with Trump, said the other G7 nations – Britain, Canada, Germany, Italy and Japan, as well as France – should remain “polite” and productive but warned that “no leader is forever”, a sign that Europe would not surrender meekly to the US president.

“Maybe the American president doesn’t care about being isolated today, but we don’t mind being six, if needs be,” Macron told reporters. “Because these six represent values, represent an economic market, and more than anything, represent a real force at the international level today.”

Canadian Prime Minister Justin Trudeau predicted “robust discussions” on trade, but other G7 members like Japan and Italy seemed less likely to want to challenge the US president.

Trump will come face-to-face at the gathering in Charlevoix, Quebec, with world leaders whose views do not chime with his on a range of issues from trade to the environment as well as Iran and the construction of a new US embassy in Jerusalem.

Trump signaled that he was in no mood to compromise as he met with Japanese Prime Minister Shinzo Abe, who has tried to cultivate a friendly relationship with the American president.

Trump raised the issue of US car imports with Abe at their meeting in Washington and said he wanted more investment in plants in the American industrial heartland of Michigan, Pennsylvania and Ohio.

Economically, Europe may have more to fear if Trump does go for auto tariffs.

Its recovery from the 2008-9 financial crisis has been far slower than that of the US where the Federal Reserve is on the cusp of another interest rate rise while the European Central Bank is still using crisis-era measures.

Financial markets around the world were battered by Trump’s trade threats. They have recovered somewhat, but are still vulnerable and Italy’s new government is also a risk. Trump may have less to fear than slow-growing Europe and Japan from a trade war in terms of economic losses if the “G6” pushes back on tariffs.

“This is unlikely to deter President Trump given the United States’ widening US$570 billion trade deficit, particularly if he feels cornered,” said Olivier Desbarres of economic strategy consultancy 4X Global Research.

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CG

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