EU and China pledge to deepen ties as world reacts to US tariffs

The European Union (EU) and China have reaffirmed their support of the World Trade Organisation “as the centre of the rules-based, multilateral system,” and have pledged to deepen trade ties in response to new US tariffs.

Washington allowed a tariff exemption period for the EU, Canada and Mexico to expire last night, resulting in 25 per cent duties on steel imports and 10 per cent on aluminium.

The move has caused consternation around the globe, particularly because of the US claim that the tariffs are being implemented on national security grounds.

French President Emmanuel Macron is reported to have branded the tariffs “illegal” during an emergency call with President Trump, while European Commission President Jean-Claude Juncker said the bloc could reply with duties of their own targeting key US exports.

At the heart of the US tariffs is what President Trump perceives as an inequity in global trade. He has made no secret of his dissatisfaction with current conditions, particularly with China, which he accuses of flooding markets with cheap steel, abusing Intellectual Property rights, and harming the US by maintaining a trade surplus.

However, these latest tariffs are focused on key US allies, not China. If President Trump aims to isolate and pressure China through a trade war, the policy is having an opposite effect.

According to ABC News, the EU and China have today pledged to increase cooperation in the face of US protectionism, with EU foreign policy chief Federica Mogherini saying: “We are living in times of geopolitical turbulence, and uncertainties, so the cooperation between EU and China becomes even more important.”

Speaking to reporters in Brussels with Chinese Foreign Minister Wang Yi, Mogherini said the two “confirmed our joint support for the WTO as the center of the rules-based, multilateral trading system.”

The irony is that many in the EU and other US allies are sympathetic to Washington’s view on China – as emerged during Asia House’s major trade dialogue in Dubai last month.

However, this latest move will do little to build a global consensus.

‘America First’ is looking increasingly like ‘America Alone’.