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Angela Merkel Warns Global Prosperity At Threat Due To Trump’s Tariffs

Angela Merkel Warns Global Prosperity At Threat Due To Trump’s Tariffs
The US tariffs were a threat for income for worker throughout the world, said German chancellor, Angela Merkel, which has intensified the war of words over Donald Trump’s proposed of imposition of import tariffs on a wide range of products from China and the European Union.
The threatened import tariffs by Trump on cars was described as a violation of the rules of the World Trade Organization and “a real threat to the prosperity of many in the world” by Merkel on Friday. This after Trump said in a television interview that he was not averse to imposing tariffs on all of the $500 billion of Chinese products imported into the country which would include virtually everything that China exports to the US.
Earlier, Trump said on Twitter that the US “should be allowed to recapture what was lost due to illegal currency manipulation and bad trade deals”.
Trump tweeted: “....The United States should not be penalized because we are doing so well. Tightening now hurts all that we have done. The U.S. should be allowed to recapture what was lost due to illegal currency manipulation and BAD Trade Deals. Debt coming due & we are raising rates - Really?”
It has been quite a while officials in the Trump administration have etched up its policy of compelling its rival economies to bring an end to what the US believes are subsidies that are artificial in nature and policies that prevent entry of American companies in to the markets. the US president is also very critical of the Federal Reserve that he believes have helped to keep the value of foreign currencies at a lower level compared to the US dollar which makes American exports expensive.
Trump’s continued comments on Germany “certainly have something to do with our economic size”, said Merkel during her annual summer news conference in Berlin.
“I try to address the criticism but also to provide an independent, confident answer, and this doesn’t always match the view held by the American president,” she said.
Trump’s criticism that Germany is taking advantage of the US in terms of trade were misplaces, she added. Merkel said that Trump’s view about the bilateral difference in trade only accounted for the trade in goods while the trade that the US does in services and the moving of the profits made by the US companies make in EU back to their home country is not taken into account. It that is accounted for, it would be found that the US is in an advantageous position compared to Germany and the EU.
The largest factory owned by car maker BMW was situated in the Spartanburg, South Carolina and employed about 8800 people and not in Germany, Merkel; pointed out.
Investors would leave the Asian and European markets if the threatened tariffs were imposed by Trump, said Oliver Jones at Capital Economics. “The retaliation by other countries to US protectionism so far has mostly been aimed at US farmers, not US multinationals. But that could change. In particular, we suspect that China will start to target US multinationals operating in China directly rather than imposing more tariffs of its own.”
Chris Beauchamp, chief market analyst at IG, said: “Having come away from the Nato summit with an apparent win using his strong-arm negotiating tactics, this move appears designed to bring the Chinese to the table.”

Christopher J. Mitchell

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