EU retaliatory tariffs on raft of US goods go into force

The EU imposed the raft of duties on US products in a tit-for-tat response to Donald Trump’s decision to slap stiff tariffs on European steel and aluminum exports. (AFP)
Updated 22 June 2018
0

EU retaliatory tariffs on raft of US goods go into force

  • Customs agents across Europe’s colossal market of 500 million people will now impose the duty, hiking prices on US-made products in supermarkets and across factory floors
  • Donald Trump claimed America had been obliged to levy the metals tariffs as it has been exploited as the world’s “piggy bank”

BRUSSELS: The European Union is enforcing tariffs on $3.4 billion in US products as of Friday in retaliation to duties the Trump administration has put on European steel and aluminum.
The goods targeted include typical American products like bourbon, peanut butter, and orange juice, in a way that seems designed to create political pressure on US President Donald Trump and senior US politicians.
"This response by the European Union is adequate, it is proportionate and it is reasonable. Needless to say, it is in full respect of EU and WTO rules," European Commission Alexander Winterstein.
Trump imposed tariffs of 25 percent on EU steel and 10 percent on aluminum on June 1. Europeans claim that breaks global trade rules.
The spat is part of a wider tussle over global trade. In two weeks, the United States will start taxing $34 billion in Chinese goods. Beijing has vowed to immediately retaliate with its own tariffs on US soybeans and other farm products.
Customs agents across Europe’s colossal market of 500 million people will now impose the duty, hiking prices on US-made products in supermarkets and across factory floors.
“These measures are the logical consequence of the US decision,” French Finance Minister Bruno Le Maire said.
“They reflect a Europe that is resolute and principled,” he said.
EU Trade Commissioner Cecilia Malmstrom said this week that the 28-nation bloc was “left with no other choice” but to impose tariffs of its own after the “unilateral and unjustified decision of the US.”
Together with US tariffs against Mexico and Canada, the trade battles have raised the spectre of a global trade war, spooking financial markets that fear major consequences to the global economy.
“We have a trade war — and it’s an escalating trade war,” SEB chief economist Robert Bergqvist said in an interview.
Brussels first drew up the list in March when Trump initially floated the 25 percent tariffs on steel imports and 10 percent on aluminum, which also target Canada, Mexico and other close allies.
The list does not specifically name brands but European Commission chief Jean-Claude Juncker spelled out in March that the bloc would target “Harley-Davidson, bourbon and Levi’s jeans.”
Cranberries, cranberry juice, orange juice, sweetcorn and peanut butter are among the other food products targeted.
Juncker said on Thursday that the US decision to impose tariffs “goes against all logic and history.”
“Our response must be clear but measured. We will do what we have to do to rebalance and safeguard,” he said.
European consumers would be able to find “alternatives,” European Commission Vice President for trade Jyrki Katainen said.
“If we chose products like Harley Davidson, peanut butter and bourbon, it’s because there are alternatives on the market. We don’t want to do anything that would harm consumers,” he said on Thursday.
“What’s more, these products will have a strong symbolic political impact.”
International Monetary Fund (IMF) chief Christine Lagarde warned on Thursday that trade war, as well as Brexit, were the key risks to the eurozone economy.
While she didn’t see a serious “direct impact of tariff increases... it’s a trend that is worrying, the breach of confidence that undermines confidence,” she said on the sidelines of eurozone minister talks in Luxembourg.
Transatlantic ties are at their lowest level for many years due to rows over a host of issues including the Paris climate agreement and the Iran nuclear deal.
Relations plumbed new depths at the recent G7 summit when Trump abruptly rejected the joint statement and bitterly insulted his Canadian host, Prime Minister Justin Trudeau.
Trump claimed America had been obliged to levy the metals tariffs as it has been exploited as the world’s “piggy bank.” He is also targeting EU auto imports with a US probe now underway.
Trump’s outbursts were the latest in which he has clashed with America’s closest allies, even as he has had warm words for autocrats like North Korean leader Kim Jong Un, with whom he had a historic meeting earlier this month, and Russia’s Vladimir Putin.
But US Assistant Secretary of State for European and Eurasian affairs Wess Mitchell said on Thursday that Trump’s approach toward his allies was about “strategic renovation.”
“Strengthening the West means making hard decisions today when we initially disagree, rather than continuing to accept the appearance of transatlantic unity,” he told the Carnegie Europe think-tank in Brussels.


Danske Bank money laundering ‘giga scandal’ spreads to Britain

Updated 3 min 3 sec ago
0

Danske Bank money laundering ‘giga scandal’ spreads to Britain

  • By 2013, the number of UK-registered customers in the branch’s non-resident portfolio had topped 1,000
  • Danske Bank Chairman Ole Andersen said that the lender had made an assessment of whether it violated any US laws
LONDON/COPENHAGEN: Danske Bank’s money laundering scandal spread on Friday as Britain’s National Crime Agency (NCA) said it is investigating the use of UK-registered companies.
“This is a giga scandal,” European Union Competition Commissioner Margrethe Vestager said, joining a growing chorus of calls for a clampdown on the billions of euros which are alleged to have been “washed” through European banks.
An NCA spokeswoman said the British agency was working with partners across government to restrict the ability of criminals to use UK-registered companies in money laundering.
British and Russian entities dominate a list of accounts used to make €200 billion ($236 billion) in payments through Danske Bank’s branch in Estonia between 2007 and 2015, many of which the bank said this week are suspicious.
By 2013, the number of UK-registered customers in the branch’s non-resident portfolio had topped 1,000, Danske Bank’s investigation revealed, ahead of clients from Russia, the British Virgin Islands and Finland.
As the scope of the alleged money laundering through Danske Bank has widened, investor concerns over the potential penalties it could face have increased, with particular focus on what action if any US authorities might take against the bank.
So far, the US has not said whether it is investigating, although Danske Bank Chairman Ole Andersen said that the lender had made an assessment of whether it violated any US laws. He has declined to share the bank’s conclusion of this.
“We need to do more to prevent money laundering from happening,” Vestager told reporters in Copenhagen following the resignation on Wednesday of Danske Bank CEO Thomas Borgen after an investigation commissioned by the bank exposed past control and compliance failings.
Borgen, 54, was in charge of Danske Bank’s international operations including Estonia between 2009 and 2012.
He said on Wednesday that he had been “personally cleared from a legal point of view” while Danske said its board had not breached their legal obligations.
The European Commission last week recommended banking supervision changes, including bolstering national authorities, but stopped short of setting up a new financial crime agency called for by the European Central Bank.
In a sign of the growing pressure on Danske Bank, which already faces criminal inquiries in Denmark and Estonia, the chief executive of CARE Danmark said on Twitter that the Danish charity had decided to end its relationship with the lender.
International aid charity Oxfam also called on Danish municipalities to cut ties with the bank, saying it has not been able to re-establish the trust of Danish citizens.
The mayor of Aalborg, Denmark’s third largest municipality, said he would discuss its partnership with Danske Bank at the next municipality committee meeting, but noted that there were only two banks in Denmark would be able to handle a municipality its size.
“Danske Bank has been involved in money laundering which is deeply reprehensible and outrageous but Nordea has been involved in tax havens, so the entire bank sector needs to clean up for us to have a trusting collaboration with the banks,” Thomas Kastrup-Larsen said.
Danske Bank’s tiny Estonian branch accounted for as much as 10 percent of group profit during the period when suspected money laundering was conducted via its operations there.