1. ITV Report

US allies warn against trade war over Trump’s tariffs plan

Mr Trump has been sharply criticised over the move (AP) Photo: AP/Press Association Images

Countries around the world have fought back against US president Donald Trump’s decision to slap tariffs on steel and aluminium imports, announcing retaliatory measures and warning that Washington’s plan will hurt American consumers.

French president Emmanuel Macron said he had told Mr Trump in a phone call that the new US tariffs on European, Mexican and Canadian goods are illegal and a “mistake”.

Mr Macron pledged the riposte would be firm and proportionate, and in line with World Trade Organisation rules.

Sorry, this content isn't available on your device.

Germany’s Volkswagen, Europe’s largest carmaker, warned that the decision could start a trade war that no side would win. The European Union and China also said they will deepen ties on trade and investment as a result of the announcement.

Mr Macron warned: “Economic nationalism leads to war. This is exactly what happened in the 1930s.”

EU trade commissioner Cecilia Malmstrom said the tariffs are “further weakening the Trans-Atlantic relations”.

Sorry, this content isn't available on your device.

Ms Malmstrom said the measures “will cause a lot of damage to our steel and aluminium industry”. She dismissed the argument that the tariffs were needed for US national security reasons, saying: “Internal security is not relevant. It is pure protectionism.”

The US president’s move makes good on his campaign promise to crack down on trading partners he says exploit poorly negotiated trade agreements to run up big trade surpluses with the United States.

US commerce secretary Wilbur Ross said the tariffs – 25% on imported steel, 10% on aluminium from Canada, Mexico and the European Union – take effect on Friday.

The import duties threaten to drive up prices for American consumers and companies and are likely to heighten uncertainty for businesses and investors around the globe.

Stock prices slumped amid fears of a trade war, with the Dow Jones industrial average falling nearly 252 points, or 1%, to 24,415.84.

US tariffs on EU steel Credit: Steelworks

Mexico complained that the tariffs will “distort international trade” and threatened to penalise US imports including pork, apples, grapes, cheeses and flat steel.

In Canada, prime minister Justin Trudeau said the tariffs were “totally unacceptable”. Canada announced plans to slap tariffs on 12.8 billion dollars’ worth (£9.6 billion) of US products, ranging from steel to yogurt and toilet paper.

Mr Trudeau said: “Canada is a secure supplier of aluminium and steel to the US defence industry, putting aluminium in American planes and steel in American tanks.

“That Canada could be considered a national security threat to the United States is inconceivable.”

Sorry, this content isn't available on your device.

Mr Trump had originally imposed the tariffs in March, saying a reliance on imported metals threatened national security. But he exempted Canada, Mexico and the European Union to buy time for negotiations – a reprieve that expired at midnight on Thursday.

Other countries, including Japan, America’s closest ally in Asia, are already paying the tariffs.

“This is protectionism, pure and simple,” said Jean-Claude Juncker, president of the European Commission.

The EU earlier threatened to counter-punch by targeting US products, including Kentucky bourbon, blue jeans and motorcycles. David O’Sullivan, the EU’s ambassador in Washington, said the retaliation will probably be announced in late June.

The US tariffs coincide with – and could complicate – the Trump administration’s separate fight over Beijing’s strong-arm tactics to overtake US technological supremacy. American commerce secretary Wilbur Ross is leaving on Friday for Beijing for talks aimed at preventing a trade war with China.

The world’s two biggest economies have threatened to impose tariffs on up to 200 billion dollars’ worth (£150 billion) of each other’s products.

The steel and aluminium tariffs could also complicate the US administration’s efforts to renegotiate the North American Free Trade Agreement with Canada and Mexico, a pact which Mr Trump has condemned as a job-killing “disaster”.