US tariffs trigger WTO spat escalation

Washington is meanwhile calling the WTO to investigate a number of retaliatory duties imposed by a range of countries. (AFP)
Updated 19 October 2018
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US tariffs trigger WTO spat escalation

GENEVA: China, Russia and the European Union are among a string of countries asking the World Trade Organization to probe new US steel and aluminum tariffs, the world trade body said Friday.
Washington is meanwhile calling the WTO to investigate a number of retaliatory duties imposed by a range of countries, the agenda for the next meeting of the organization’s Dispute Settlement Body (DSB) showed.
The agenda for the DSB meeting set to be held on October 29 shows that the EU, China, Russia, Canada, Mexico, Norway and Turkey plan to ask for the creation of a panel of experts to review US President Donald Trump’s decision to hit them with tariffs of 25 percent on steel and 10 percent on aluminum.
Marking a departure from a decades-long US-led drive for free trade, Trump has justified the steep tariffs with claims that massive flows of imports to the United States threaten national security.
The tariff spat has escalated into an all-out trade war between the US and China and growing trade tensions between Washington and many of its traditional allies.
The US is meanwhile planning to request that the DSB create another set of expert panels to review the legality of retaliatory tariffs imposed by China, Canada, the EU and Mexico.
The requests, which follow rounds of failed consultations, mark and escalation in an ongoing showdown at the WTO around Trump’s controversial trade policies.
Under WTO regulations, parties in a dispute can block a first request for the creation of an arbitration panel, but if the parties make a second request, it is all but guaranteed to go through.
“Once the panel is established and composed, the EU is ready to demonstrate that the United States’ import duties are WTO-inconsistent and to obtain a ruling that condemns the US and brings relief to the EU industry,” an EU Commission spokesperson said.
The creation of a DSB panel usually triggers a long and often costly legal battle that sometimes takes years to resolve.


BMW plans massive cost cuts to keep profits from sputtering

Updated 20 March 2019
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BMW plans massive cost cuts to keep profits from sputtering

  • ‘Our business model must remain a profitable one in the digital era,’ chief executive Harald Krueger said
  • Total number of employees is set to remain flat at around 135,000 worldwide

MUNICH: German high-end carmaker BMW warned Wednesday it expects pre-tax profits “well below” 2018 levels this year as it announced a massive cost-cutting scheme aimed at saving $13.6 billion (€12 billion) in total by 2022.
A spokesman said that “well below” could indicate a tumble of more than 10 percent.
The Munich-based group’s 2019 result will be burdened with massive investments needed for the transition to electric cars, exchange rate headwinds and rising raw materials prices, it said in a statement.
Meanwhile it must pump more cash into measures to meet strict European carbon dioxide (CO2) emissions limits set to bite from next year.
And a one-off windfall in 2018’s results will create a negative comparison, even though pre-tax profits already fell 8.1 percent last year.
Bosses expect a “slight increase” in sales of BMW and Mini cars, with a slightly fatter operating margin that will nevertheless fall short of their 8.0-percent target.
“We will continue to implement forcefully the necessary measures for growth, continuing performance increases and efficiency,” finance director Nicolas Peter said at the group’s annual press conference.
BMW aims to achieve €12 billion of savings in the coming years through “efficiency improvements” including reducing the complexity of its range.
“Our business model must remain a profitable one in the digital era,” chief executive Harald Krueger said.
This year, most new recruits at the group will be IT specialists, while the total number of employees is set to remain flat at around 135,000 worldwide.
Departures from the sizeable fraction of the workforce born during the post-World War II baby boom and now reaching retirement age “will allow us to adapt the business even more to future topics,” BMW said.
All the firm’s forecasts are based on London and Brussels reaching a deal for an orderly Brexit and the United States foregoing new import taxes on European cars.
“Developments in tariffs” remain “a significant factor of uncertainty” in looking to the future, finance chief Peter said, adding that “the preparations for the UK’s exit from the EU will weigh on 2019’s results as well.”
In annual results released ahead of schedule last Friday, BMW blamed trade headwinds and new EU emissions tests for net profits tumbling 16.9 percent in 2018, to €7.2 billion.