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Diplomacy, Economics

European leaders urge end to trade wars

EU leaders call on US – China to resolve trade war.


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Updated: August 27, 2019

European leaders attending the G7 Summit voiced their deep concern on Saturday over the trade wars between the United States and China and a looming one between the US and the European Union.

European Council President Donald Tusk on Saturday called for an end to the trade wars.

“Trade deals and the reform of WTO are better than trade wars,” Tusk said in a press conference before leaders of the US, Germany, Japan, the United Kingdom, France, Italy and Canada meet in the oceanfront city of Biarritz, France, for the 45th edition of the G7 summit from Aug 24-26.

“Trade war will lead to recession, while trade deals will boost the economy, not to mention the fact that trade wars among G7 members will lead to eroding of the already weakened trust among us.”

His words came just a day after the US and China announced new tit-for-tat tariffs on each other’s exports, an escalation that has brought down the stock prices in the US and other parts of the world and increased business uncertainty.

It also came after US President Donald Trump, before leaving for the G7 summit in France, repeated his threat to impose punitive tariffs on French wines if France goes ahead with the new digital services tax, which is deemed targeting US tech giants such as Google, Facebook and Amazon.

The US and the EU have already threatened tit-for-tat tariffs over airplane subsidies. Trump has also threatened to slap heavy tariffs on European cars, triggering deep concern in Germany, a major car exporter to the US and an economy that some believe are heading into recession.

Tusk said the EU will stand with France and strike back if the US imposes tariffs on French wines. “If the US imposes tariffs on France, the EU will respond in kind,” he said.

He said the last thing that the EU needs and wants is a confrontation, especially with “our best ally, the United States”, but added that “we have to be ready… and we are ready.”

He stated that “France can count on our loyalty, as all member states do”.

On Saturday, French President Emmanuel Macron had an unscheduled lunch with Trump in Biarritz to discuss a host of issues, from Iran to trade, ahead of the summit.

“I must convince all our partners that tensions, in particular commercial tensions, are bad for everyone,” Macron said in a video address.

“We must de-escalate the matters and stabilize things to avoid trade wars that are happening everywhere,” he said, adding that “then we must find new ways to really get things going again to create growth”.

British Prime Boris Johnson, who is attending the G7 summit for the first time, also weighed in on the trade war on Saturday, saying he would urge Trump to ease tensions with China.

When asked by reporters at the airport if he would tell Trump not to escalate his trade war with China, Johnson said, “You bet.”

Johnson said his priority during the summit is “the state of global trade” and he is “very worried about the way it’s going, the growth of protectionism, of tariffs that we’re seeing”.

“I want to see an opening up of global trade, I want to see a dialing down of tensions and I want to see tariffs come off,” he said, according to Reuters.

Johnson is expected to talk with Trump on Sunday about a possible trade deal between the UK and the US.

German Chancellor Angela Merkel said in a video message on Saturday ahead of the summit that “Time is going to be short because there are so many problems.”

Besides trade wars, the World Trade Organization appellate body, the highest international trade court, is close to stop functioning due to the US refusal to allow the appointment of judges.



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