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Abu Dhabi, UAESaturday 22 September 2018

Trump's metal tariffs plan sparks backlash at home and abroad

The US president's shock announcement has upset everyone from Republican lawmakers to China, Canada and the EU

US President Donald Trump waves upon his arrival in West Palm Beach, Florida on March 2, 2018. Kevin Lamarque / Reuters
US President Donald Trump waves upon his arrival in West Palm Beach, Florida on March 2, 2018. Kevin Lamarque / Reuters

US president Donald Trump is facing a backlash both at home and abroad after his plan to impose steep tariffs on metal imports sparked talk of a global trade war.

After proposing tariffs of 25 per cent on steel and 10 per cent on aluminium from other countries on Thursday, Mr Trump warned on Twitter the following day that "trade wars are good, and easy to win".

China's Commerce Ministry shot back later on Friday, saying Mr Trump's plan would "seriously damage multilateral trade mechanisms represented by the World Trade Organisation and will surely have huge impact on normal international trade order", the Associated Press reported.

The European Union, meanwhile, has drawn up a list of US products on which to apply tariffs if Mr Trump follows through on his plan.

"We will put tariffs on Harley-Davidson, on bourbon and on blue jeans – Levi's," European Commission President Jean-Claude Juncker told German television, according to Reuters.

Canada, the biggest supplier of steel and aluminium to the US, will bear the brunt of Mr Trump's plans if they come to fruition.

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Read more: Trump’s new trade war is absurd national and economic policy – but it’s great posturing and exactly what he promised

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Canadian Prime Minister Justin Trudeau said any US tariffs on steel and aluminium would be "absolutely unacceptable" and vowed to continue to engage with American officials on the issue.

The International Monetary Fund also expressed concern, saying the proposed tariffs would likely damage the US economy and those of other nations.

Mr Trump's announcement came as Chinese President Xi Jinping's top economic adviser, Liu He, was in the US on a visit. He had been tasked with bringing a conciliatory message to China's largest trading partner but his trip was overshadowed by the US president's shock plans.

Mr Liu told US business leaders in Washington that Beijing hoped the White House will revive high-level dialogue on economic disputes and name a new chief liaison to defuse mounting trade tensions, a person briefed on the matter told the Associated Press.

The adviser was speaking at an event with executives including former US Treasury Secretary Hank Paulson and the CEOs of JP Morgan Chase and chipmaker Qualcomm.

Mr Liu said he would take charge of reform efforts this month and wants a list of US demands for what China could do to ease tensions, according to the source.

In the US capitol, Mr Trump's controversial proposal has provoked rarely seen urgency among Republican lawmakers, who are scrambling to convince the president he will spark a trade war that could stall the economy's recent gains if he does not reverse course.

The issue pits Mr Trump's populist promises to his voters against the Republican party's free trade orthodoxy and the interests of business leaders. And unlike recent immigration and gun policy changes that require legislation, Mr Trump can alter trade policy by executive action. That intensifies the pressure on congressional Republicans to change his mind before he gives his final approval for the penalties as early as next week.

Speaker of the House of Representatives Paul Ryan called Mr Trump after the president's surprise announcement, and continues to hope the White House will reconsider the decision, according to the Associated Press. Senior lawmakers, including Senator Ben Sasse, have also offered the president their own private counsel. Some are appealing to his desire for a robust stock market and warning the tariffs could unravel some of the gains they attribute to the tax bill he signed last year.

Representative Kevin Brady, chairman of the House Ways and Means Committee, tried one of the most direct lines that lawmakers have to the White House: Talking to Mr Trump through cable TV news.

"The president has not yet issued these tariffs," Mr Brady told Fox News on Thursday, hours after Mr Trump announced the tariff targets. "He's been continuing to listen."

Listening to various viewpoints, though, has never been the gripe against Mr Trump.

Unlike former President Barack Obama, who often irked lawmakers for lecturing them during meetings, Mr Trump retains a level of popularity among Capitol Hill Republicans in part because he's more than happy to invite lawmakers in and hear them out. But problems have arisen when members of the legislative branch leave the White House under the impression that Mr Trump is on their side – or at least willing to consider their views – only to find out later that his support has drifted away.

And while Republicans in Congress have learnt to ignore Mr Trump's policy whims – knowing whatever he says one day on guns, immigration or other complicated issues could very well change by the next – on trade tariffs, they say the stakes are too high for them to sit back and wait for Mr Trump to change his mind. Indeed, their relentless public condemnation of the tariffs has been notably sharper than their typical handling of the president's policy whims.

Not wise, said Senator Orrin Hatch. A "big mistake," said Senator Pat Toomey. "Kooky," said Mr Sasse.

Republican lawmakers, and some outside groups, want Mr Trump to at least consider a more targeted approach, or exemptions for countries that engage in what they view as fair trade practices.

"We're all urging the president, look, continue to narrow this to these unfairly targeted products," Mr Brady said.

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