Trump targets EU: Threats of new tariffs loom large
Donald Trump remotely participated in the World Economic Forum in Davos on Thursday. The President of the USA once again mentioned the trade deficit with the European Union and stated that the EU treats the United States "very unfairly." He announced a response.
Davos, Switzerland, is hosting the 55th economic forum. The new president of the USA was also present, though not physically. Donald Trump spoke remotely.
During his speech, the president again harshly criticized the European Union, claiming that it treats the United States "very unfairly." Donald Trump pointed out, among other issues, tariffs, the lengthy process of issuing permits, and penalties for American tech giants, which, in his opinion, constitute a "tax."
The US president might have been referring, among others, to the fact that in September, the CJEU ruled that Ireland provided Apple with an illegal tax advantage, allowing the tech giant to be taxed at a rate of 0.05%, thereby distorting competitive conditions within the internal market. Apple must therefore pay overdue taxes.
Another case also reached its conclusion in the fall. The Court of Justice of the European Union imposed a fine of 2.4 million euros (approximately 3.6 million CAD) on Google for abusing its dominant position by favouring its own shopping comparison service.
US President threatens tariffs
Donald Trump announced that the USA would have to respond. "So, we have, you know, hundreds of billions of dollars of deficits with the EU, and nobody is happy with it. And we’re going to do something about it, but nobody is happy with it. So, I think the EU has to speed up their process," he stated.
This is another political announcement referring, in fact, to the imposition of tariffs on goods imported from the EU. So far, Trump has provided more specifics regarding tariffs on goods from Canada, Mexico, and China, but the EU is next in line.
The words of the US president did not escape the notice of forum participants in Davos. The head of the WTO warned against the realization of Donald Trump's plans, specifically a trade war, which could begin.
"We’ve done the numbers. If we have tit-for-tat retaliation [against possible US tariffs], whether there is 25% to 60%, and we go to where we were in 1930s, we’re going to see double-digit global GDP losses. That’s catastrophic. Everyone will pay," said Ngozi Okonjo-Iweala, Director-General of the World Trade Organization.
