Indications of a new flareup in US-Europe trade war, President Trump

Davos: US President Donald Trump has threatened that ‘Europe is fully aware that if they do not sign a proper and a fair trade agreement with the United States, we can impose taxes on them.’ This threat by Trump indicates a new flareup of a trade war between the two leading economies of the world. Following the verdict of the World Trade Organisation, in October last year, the United States imposed taxes worth billions of dollars on European countries.

The United States and China recently signed a preliminary agreement and China has agreed to increase the purchase of US goods. It was said that after the deal with China, President Trump would focus his attention on Europe. President Trump had a dialogue with Chief of the European Union, Ursula Von Der Leyen, in a meeting held at Davos. Sources have informed that the issue of the trade agreement with Europe was an important issue on the agenda of the meeting.

After the meeting with the chief of the European Union, President Trump said that the talks were positive. But he also warned at the same time that if Europe does not agree for an agreement, the United States can impose taxes on European goods. Trump has, time and again, raised the issue of trade imbalance with Europe and has accused the European countries of taking an adamant stance.

Cars form a major part of the US-Europe trade and Trump had threatened to impose a tax to the tune of 20% to 25% on all the automobiles imported from Europe if the European Union did not yield to the US demands. The European officials, while replying to the US threat, had warned to target motorcycles and other products exported from the United States. As both the leading economies of the world are showing no signs of retreat, the indications are of a new flareup in the US-Europe trade war.