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Tuesday, 22 May 2018

Europe and the commercial war with US

Por olimurs.92

European countries don't discard the possibility that the American president Donald Trump enlarges the exemptions, but neither that he increases the rates. The leader's government has been characterized to be unpredictable and he could announce a tariff ascent for the steel and the European aluminum, so the old continent enrolls for a commercial war with the United States.

The European economy is extremely fragile of Trump's threats because the commercial surplus of the EU, under the influence of Germany, is already very swollen, and it makes the European recovery extremely sensitive to the protective measures. Berlin has been developing mercantilist politics for years which have elevated its commercial surplus up to 90 percent of GDP, in spite of the continuous warnings of Washington.

In the current panorama of the European unstable unit conservation, depends -in great measure- of the good relations between the German chancellor Angela Merkel and French president Emmanuel Macron. On the other hand, resident Trump has chosen the appropriate moment to begin the commercial battle because Macron can be bothered by Merkel's reticences to approve the euro reformations and if that doesn't change, he could block the German initiatives to avoid the war with the United States.

The solution proposed until the moment by Germany is a commercial agreement among the European partner's measures -difficult to accept- for not making effective its threat of increasing the rates.

As it is, and aware that anything is possible, Europe is ready to react and the whole world is waiting for the answer. It is almost impossible that -if Washington requests it- Brussels will accept to fix limits to the exports.

That’s why its commission has designed a strategy to hit where it hurts the most to the U.S. and it is with tariff ascents on the exports of Florida orange juice, Harley-Davidson sales or Kentucky’s bourbon, three huge republican feuds. Although the following movement is ignored, the White House has threatened to go up the tariffs of the deluxe cars, something that would affect Germany a lot.

It is all about waiting to see how all of this finishes, right now, the battlefield is getting ready for a possible commercial conflagration USA-UE.