It didn’t take long for Canada and the European Union to retaliate against President Donald Trump’s decision to increase tariffs on aluminum and steel.
According to published reports, Canada – the largest steel and aluminum supplier to the U.S. – said it will place 25% reciprocal tariffs on steel products and also raise taxes on things like tools, computers and sports equipment, among others, The Associated Press reported.
The European Union will raise tariffs on American beef, poultry, bourbon and motorcycles, bourbon, peanut butter and jeans, according to the AP report.
Combined, the new tariffs will cost companies billions of dollars, and further escalate the uncertainty in two of the world’s major trade partnerships. Companies will either take the losses and earn fewer profits, or, more likely, pass costs along to consumers in the form of higher prices.
European Commission President Ursula von der Leyen warned prices will go up, in Europe and the United States, and jobs are at stake.
“We deeply regret this measure. Tariffs are taxes. They are bad for business, and even worse for consumers,” von der Leyen said, according to the AP.
EU officials have made clear that the tariffs are aimed at products made in Republican-held states, such as beef and poultry from Kansas and Nebraska and wood products from Alabama and Georgia. The tariffs will also hit blue states such as Illinois, the No. 1 U.S. producer of soybeans, which are also on the list, according to the AP.
Spirits producers have become collateral damage in the dispute over steel and aluminum. The EU move “is deeply disappointing and will severely undercut the successful efforts to rebuild U.S. spirits exports in EU countries,” Chris Swonger, head of the Distilled Spirits Council, told the AP. The EU is a major destination for U.S. whiskey, with exports surging 60% in the past three years after an earlier set of tariffs was suspended.
Von der Leyen said in a statement that the EU “will always remain open to negotiation.”
Canada’s incoming Prime Minister Mark Carney said in interviews Wednesday he’s ready to meet with Trump if he shows “respect for Canadian sovereignty″ and is willing to take ”a common approach, a much more comprehensive approach for trade.″
