U.S. Trade Clash

Germany’s Worst-Case Scenario

main 78901411 source Pablo Martinez Monsivais DPA – Angela Merkel Donald Trump in White House March 17 2017
Is it a dance or a duel? Source: Pablo Martinez Monsivais / DPA

It’s official now. Donald Trump’s anti-trade rhetoric has translated into hard-hitting import duties on European and Asian steel makers. U.S. Commerce Secretary Wilbur Ross announced Thursday plans to impose duties as high as 148 percent on imports from France, Germany, Japan and Taiwan.

German Foreign Minister Sigmar Gabriel responded promptly on Friday, saying the United States was giving domestic firms “unfair competitive advantage” over European rivals and others in violation of international trade law.

“We Europeans cannot accept this,” Mr. Gabriel said in a statement. “The E.U. must now consider whether it, too, will lodge a complaint with the WTO. I strongly support this.”

The minister warned that the duties could easily trigger a trade war with the United States, Germany’s biggest export market ahead of neighboring France and Britain. “If the United States continues its unfair competition policies, it will create the same dangers for other industries,” he said.

Export-driven Germany has the world’s largest trade surplus – a net €253 billion, or $271 billion, after deduction of imports – which is ahead of China and Japan. Last year, the country exported €107 billion worth of goods to the United States, including BMW cars, Siemens medical equipment and SAP business software.

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