Washington DC [US], May 25: U.S. President Donald Trump threatened to ratchet up his trade war again.
Pushing for a 50% tariff on European Union goods starting June 1 and warning Apple (AAPL.O), opens new tab he may slap a 25% levy on all imported iPhones bought by U.S. consumers.
The twin threats, delivered via social media, roiled global markets after weeks of de-escalation had provided some reprieve in the tariff battle. Major U.S. stock indexes and European shares fell and the dollar weakened, while the price of gold, a safe-haven for investors, rose. U.S. Treasury yields fell on fears about tariffs' effect on economic growth.
Trump's broadside against the EU was prompted by the White House's belief that negotiations with the bloc are not progressing fast enough. His saber-rattling also marked a return to Washington's stop-and-start trade war that has shaken markets, businesses and consumers and raised fears of a global economic downturn.
And the president's attack on Apple is his latest attempt to pressure a specific company to move production to the United States, following automakers, pharmaceutical companies and chipmakers. The United States, however, does not mass-produce smartphones - even as U.S. consumers buy more than 60 million phones annually - and moving production would likely increase the cost of iPhones by hundreds of dollars.
Later on Friday, Trump told reporters inside the Oval Office that his proposed tariff on Apple would also apply to "Samsung and anybody that makes that product," apparently referring to smartphones. He said he expected the new phone levy to be in place by the end of June.
Trump reiterated his complaint that the European Union treated the U.S. badly and restricted the U.S. from selling cars into the EU. "And I just said, 'It's time that we play the game the way I know how to play the game.'"
"I'm not looking for a deal," Trump said when asked whether he expected a deal before June 1. "We've set the deal - it's at 50%. But again, there's no tariff if they build their plant here."
EU trade Chief Maros Sefcovic said the European Commission, the EU's executive arm, was fully committed to securing a deal that worked for both sides, following a Friday phone call with U.S. counterpart Jamieson Greer and U.S. Commerce Secretary Howard Lutnick.
He added that EU-U.S. trade "must be guided by mutual respect, not threats."
Source: Fijian Broadcasting Corporation
