Europe's trade confrontation with the US escalates

President Donald Trump during a bill signing ceremony at the South Court Auditorium of the Eisenhower Executive Building in Washington

Although the USA has said the tariffs are being applied for national security reasons, the economy secretary argued that steel and aluminum are integral supplies in highly integrated strategic sectors of the North American economy, such as the automotive, aerospace, electric and electronic industries.

The tariffs take effect on July 1 and will last until the US ends its move.

"We follow this with a lot of anxiety", Malmström said of the investigation.

A 25 per cent tariff on steel imports and 10 per cent tariff on aluminum imports will be imposed on the EU, Canada and Mexico from midnight (12 pm Friday, Singapore time), Ross told reporters. "Most of the time as I travel around I get confirmation these are high quality high value steel imports", he said, adding that in many cases these were products that couldn't be obtained in the U.S.

Wilbur Ross came a little closer to honesty about the government's policy when he stated: "We take the view that without a strong economy, you can not have strong national security".

Washington will announce plans to slap tariffs on European Union steel and aluminium imports as early as Thursday morning, sources said, while the United States commerce secretary said any escalation of their trade dispute would depend on the bloc's reaction.

"We are imposing dollar for dollar tariffs for every dollar levied against Canadians by the U.S.", he wrote.

Trump has threatened to take steps to withdraw from NAFTA for more than a year, but during his first year in office he was coaxed out of taking dramatic steps by advisers like National Economic Council President Gary Cohn and Secretary of State Rex Tillerson.

A White House official, who spoke on condition of anonymity to describe the back and forth between both countries, said Trudeau spoke to Trump last Friday, and then Trudeau called Pence on Monday to follow up.

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Malmstrom said that specific retaliatory measures would be submitted to the World Trade Organization by June 20.

Canadian Prime Minister Justin Trudeau called the move "totally unacceptable", while in London a spokesperson for Theresa May said the British government was "deeply disappointed". All three affected parties had already said they would respond in kind, and Canada was the first to announce a slew of countermeasures.

Brussels will also now trigger a dispute settlement case at the World Trade Organisation, saying the United States is acting against agreed worldwide rules. "But we see no sign of that in this action today by the USA administration".

EU members have given broad support to a European Commission plan to set duties on 2.8 billion euros (S$4.4 billion) of USA exports if Washington ends tariff exemptions. In the case of Canada and Mexico, the USA had hoped to address its national security concerns in the context of ongoing efforts to renegotiate NAFTA, but those talks have taken longer than expected and there is now no precise end date in sight, Ross said.

The British government said it was "deeply disappointed" and the United Kingdom and other European Union countries "should be permanently and fully exempted" from the tariffs.

Mexico complained that the tariffs will "distort worldwide trade" and said it will penalize USA imports including pork, apples, grapes, cheeses and flat steel.

The measures announced on Thursday ended months of uncertainty about possible exemptions, illustrating a hardening of the Trump administration's stance towards trade negotiations.

Trump's remarks follow a refusal by Trudeau to accept terms laid out by the USA administration.

He said the government and European Union should work closely on counter-measures. But these must leave our allies saying "with friends like these..."

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