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EU retaliates against Trump tariffs with €26bn ‘countermeasures’
The EU has announced it will impose trade “countermeasures” on €26bn (£22bn) worth of US goods in retaliation after Donald Trump’s tariffs on steel and aluminium imports, escalating a global trade war.The president of the European Commission, Ursula von der Leyen, called the 25% US levies on global imports of the metals “unjustified trade restrictions”, after they came into force at 4am GMT on Wednesday.“We deeply regret this measure,” von der Leyen said in a statement, as Brussels announced it would be “launching a series of countermeasures” on 1 April. “The European Union must act to protect consumers and business,” she added.The commission said it would be targeting industrial products in response, including steel and aluminium, as well as household tools, plastics and wooden goods.In addition, the EU measures will affect some US agricultural products, such as poultry, beef, some seafood, nuts, eggs, dairy, sugar and vegetables, provided they are approved by member states.The retaliatory measures will also entail Brussels reimposing the tariffs on US goods including bourbon whiskey, jeans and Harley-Davidson motorbikes that it introduced during the first Trump term.“We will always remain open to negotiation. We firmly believe that in a world fraught with geopolitical and economic uncertainties, it is not in our common interest to burden our economies with tariffs,” von der Leyen said.France’s European affairs minister, Benjamin Haddad, said on Wednesday that the EU could “go further” in its response to the US tariffs. The measures “are proportionate”, Haddad told TF1 television. “If it came to a situation where we had to go further, digital services or intellectual property could be included,” he said.Britain would not issue its own immediate measures in response to the US tariffs but was going to “reserve our right to retaliate”, a UK minister said.The exchequer secretary to the Treasury, James Murray, told Times Radio the levies were disappointing but “we want to take a pragmatic approach, and we’re already negotiating rapidly toward an economic agreement with the US, with the potential to eliminate additional tariffs”.Asked by Sky News whether Britain’s response to the levies could be called weak in comparison with Brussels, Murray said the UK was in a “very different position than the EU” and does not want to be “pushed off course” as it pursues a trade deal with Washington.“We think the right response is to continue pragmatically, cool-headedly, without a knee-jerk response, but toward our economic agreement that we’re negotiating with the US to secure, because that’s in the best interests of the UK,” he said.skip past newsletter promotionafter newsletter promotionHis comments came after the prime minister, Keir Starmer, said on Tuesday that Britain would not respond with its own counter-tariffs, after last-ditch efforts to persuade Trump to spare British industry from his global tariffs appeared to have failed.The UK steel industry warned that Trump’s tariffs “couldn’t come at a worse time”, and said the move would have “hugely damaging consequences for UK suppliers and their customers in the US”.Gareth Stace, the director general of the trade association UK Steel, called the Trump administration’s move “hugely disappointing”. He said: “President Trump must surely recognise that the UK is an ally, not a foe. Our steel sector is not a threat to the US but a partner to key customers, sharing the same values and objectives in addressing global overcapacity and tackling unfair trade.“These tariffs couldn’t come at a worse time for the UK steel industry, as we battle with high energy costs and subdued demand at home, against an oversupplied and increasingly protectionist global landscape.”The introduction of EU measures came after a day of drama on Tuesday, when Trump threatened to double tariffs on Canadian steel and aluminium in response to Canadian threats to increase electricity prices for US customers.The US president backed off from those plans after the Ontario premier, Doug Ford, agreed to suspend his province’s decision to impose a 25% surcharge on electricity exports to the states of Minnesota, Michigan and New York. More
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Trump threatens to raise Canadian steel and aluminum tariffs to 50%
The looming trade war between the US and Canada escalated on Tuesday as Donald Trump threatened to double tariffs on Canadian steel and aluminum after Canadian threats to increase electricity prices for US customers.On Tuesday morning Trump announced plans to double tariffs on Canadian steel and aluminum from 25% to 50% and once again threatened to annex Canada as retaliation for the province of Ontario’s imposition of a 25% surcharge on electricity exports to several US states, in a dramatic escalation of the trade war between the two ostensibly allied countries.The news set off another stock market sell-off on Wall Street that was tempered when Ontario’s premier, Doug Ford, said he made a deal with the US commerce secretary, Howard Lutnick, to suspend Canada’s 25% tariff on exports of electricity to Michigan, New York and Minnesota after Lutnick agreed to discuss renewing existing trade relations.Incorrectly calling Canada “one of the highest tariffing nations anywhere in the world”, Trump said he had instructed his secretary of commerce to increase levies on the metals due to start Wednesday morning. He also threatened more tariffs on 2 April on the car industry that would “essentially, permanently shut down the automobile manufacturing business in Canada”.Asking rhetorically why the US received electricity from another country, he accused Canada of using energy, “that so affects the life of innocent people, as a bargaining chip and threat” and said “they will pay a financial price for this so big that it will be read about in History Books for many years to come”.After the news that Ontario was suspending its electricity hikes, Trump said he would “probably” reconsider imposing the higher tariffs on Canada.Mark Carney, Canada’s incoming prime minister, called Trump’s latest move “an attack on Canadian workers, families and businesses” and promised to “keep our tariffs on until the Americans show us respect and make credible, reliable commitments to free and fair trade”.The Trump administration was also reportedly preparing on Tuesday to institute a new rule that would require some Canadians staying in the US for more than 30 days to register personal information and agree to fingerprinting, according to Bloomberg. Currently there is largely frictionless travel for citizens between the two countries.The fractious economic battle between the US and Canada has developed even graver undertones as Trump makes increasingly aggressive threats for the US to absorb its northern neighbour. Although at first claiming that he wanted Canada to crack down on fentanyl, Trump has now accused the US ally of underpaying for military protection and incorrectly described the trade imbalance with Canada as a $200bn subsidy from the US.Trump coupled his tariff declaration with openly aggressive language about making Canada “our cherished Fifty First State”, repeating a constant refrain over the last few months. He claimed American statehood for Canada would make “all tariffs, and everything else, totally disappear”, called the border “an artificial line of separation drawn many years ago” and suggested the Canadian national anthem, O Canada, would become a state anthem.The rhetoric has inspired a rare unity among Canadian politicians, with Carney campaigning for Liberal leader on standing up to Trump, and saying to a standing ovation in his acceptance speech on Sunday that “Canada never, ever will be part of America”.Trump’s moves are just the latest in the chaos around the president’s trade policy, amid tumbling stock markets and fears it could trigger a possible US recession.The White House’s strategy so far has been to play down the anxiety on Wall Street, even as stocks waver. After Trump refused to rule out the possibility of a recession in an interview with Fox News over the weekend, the Nasdaq had its worst day on Monday since September 2022, dropping 4%.Shares in US automakers also fell after the announcement, as traders bet that high metal tariffs would drive up costs for the American industrial sector, eating into their profits. Ford Motor dropped nearly 4%, while General Motors dipped by 1.3%. Shares in the carmaker Stellantis – which has several manufacturing facilities in Canada – fell by more than 5%.Price premiums for aluminum on US physical market soared to a record high above $990 a metric ton, Reuters reported.The Ontario premier Ford has said that Trump must take the blame if there is a recession in the US, telling MSNBC on Tuesday: “If we go into a recession, it will be called the Trump recession.”Ford has said in the past that he would be willing to cut off US energy supply from Canada completely in response to Trump’s tariffs.“We will be relentless,” Ford said, adding he would not “hesitate” to shut off electricity exports to the US if Trump continues the trade war.“That’s the last thing I want to do. I want to send more electricity down to the US, to our closest allies or our best neighbors in the world. I want to send more electricity.” But, he said, “Is it a tool in our toolkit? One hundred per cent, and as he continues to hurt Canadian families, Ontario families, I won’t hesitate to do that.”Ford also encouraged American CEOs, who have been largely silent on the trade war and threats to Canadian sovereignty, to speak up. On Tuesday Trump is set to meet with the Business Roundtable, an influential group of business leaders that includes the CEOs of Google, Amazon and JPMorgan.Ford said: “We need those CEOs to actually get a backbone and stand in front of him and tell him, ‘This is going to be a disaster. It’s mass chaos right now.’”The group said in a statement last week that while it supported trade policies that “open markets to US exports, revitalize the domestic manufacturing base and de-risk supply chains”, it called on the White House to “preserve the benefits” of the US-Mexico-Canada Agreement (USMCA), which Trump himself signed in 2020 but has since apparently violated by suddenly imposing steep tariffs on both countries.Tariffs of 25% on steel and aluminum imports were already slated to apply to all countries globally on Wednesday, after Trump announced them last month.Both consumer and business confidence has dropped in the US since Trump entered office.A survey published on Monday in Chief Executive magazine found that CEOs’ rating of the current business climate fell 20% in January, from 6.3 out of 10 – with 1 being “poor” and 10 being “excellent” – to 5, the lowest since spring 2020.
Meanwhile, consumer confidence measured by the Conference Board found that confidence dropped over 6% in February, its biggest month-to-month drop since August 2021.Trump had not yet spoken with Carney, said the White House press secretary Karoline Leavitt on Tuesday, arguing that the tariffs on Canadian metals “was a retaliatory statement due to the escalation of rhetoric that we’ve seen out of Ontario, Canada”.“I think Canada is a neighbor. They are a partner. They have always been an ally,” she said, adding: “Perhaps they are becoming a competitor now.” More - in US Politics
Canada’s designated PM Mark Carney meets with Trudeau as Trump threat looms
Canada’s incoming prime minister, Mark Carney, has met with Justin Trudeau as the pair discuss a transfer of power after the former central banker’s landslide victory at the Liberal party’s leadership race.The meeting on Monday sets the stage for an imminent federal election and gives Canada a fresh leader to square off against the United States president, with the two countries locked in a bitter trade war provoked by Donald Trump.Briefly speaking to reporters, Carney said he was “honoured” to receive nearly 86% of the vote, one of the most decisive wins of a party leader in decades.But, the 59-year-old former banker said he had “a lot of wood to chop” as he prepares to assume the reins of a country tearing on the verge of economic calamity.Carney is widely expected to call an election within days, reflecting both the urgency of Canada’s trade war with the United States, and the awkward reality that as prime minister without a seat in parliament, he is unable to attend sessions of the House of Commons.First, however, Trudeau must visit the governor general – the largely ceremonial representative of King Charles – and officially tender his resignation. Carney will then swear oaths of office and allegiance and form a cabinet. This is expected to happen in the coming days.After his meeting with Trudeau, Carney said the transition “will be seamless and it will be quick.’Under Canadian law, an election period must be at least 37 days and no more than 51 days, with the vote falling on a Monday. Party insiders have indicated Canadians will probably vote on 28 April or 5 May.The former governor of the Bank of England and of Canada takes the job of prime minister as Ottawa finds itself at odds with its closest ally and largest trading partner. Last week Trump announced a 25% tax on all Canadian goods, with a carve-out for the automotive and energy sectors. The tariffs have the power to push Canada’s fragile economy into a recession.Carney spent much of his acceptance speech on Sunday evening foreshadowing the theme that will probably define his tenure as prime minister: conflict with the volatile and unpredictable president who has threatened repeatedly to annex Canada.“America is not Canada. And Canada never, ever, will be part of America in any way, shape or form,” Carney told supporters. “We didn’t ask for this fight. But Canadians are always ready when someone else drops the gloves,” Carney said. “So the Americans, they should make no mistake, in trade as in hockey, Canada will win.While the Liberals trail slightly in the polls, Carney’s ascension within the party, and Trudeau’s exit, has dramatically revived their chances of eking out a victory in the next election – a result that was widely seen as unthinkable just weeks ago.Carney, a political novice who has never held elected office, also criticised his main political rival: the Conservative leader, Pierre Poilievre.“Donald Trump thinks he can weaken us with his plan to divide and conquer. Pierre Poilievre’s plan will leave us divided and ready to be conquered,” Carney said. “Because a person who worships at the altar of Donald Trump will kneel before him, not stand up to him.”Carney also suggested Poilievre’s partisan nature was a liability in the existential fight for Canada’s future. “His anger isn’t action. His division isn’t strength. Division won’t win a trade war,” he said.Earlier that evening, Poilievre accused Carney of being “sneaky” at a Sunday evening rally in London, Ontario.“And now our Liberal friends, after they’ve caused all this damage, are going to pull a sneaky trick. They’re going to try to get elected for a fourth term. A fourth term by replacing Justin Trudeau with his economic adviser, Mark Carney,” he said. “Carney’s advice drove up taxes, housing costs and food prices, while he personally profited from moving billions of dollars and thousands of jobs out of Canada to the United States.”Carney’s dominant win outshone most expectations and provides the leader with both a strong mandate and a unified party. He won in all 343 of the Liberal party districts. His closest rival, the former finance minister Chrystia Freeland finished a distant second with only 8% of the vote, and was unable to win the most votes in her own district. More
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‘I hate to predict things’: Trump doesn’t rule out US recession amid trade tariffs
Donald Trump on Sunday refused to rule out the possibility that the US economy will head into recession this year and that inflation will rise, as his chaotic trade tariffs policy cause uncertainty and market turbulence.The US president predicted that his economic goals would take time and a period of transition to bear fruit. But when asked in an interview with the Fox News show Sunday Morning Futures “are you expecting a recession this year?” he demurred.“I hate to predict things like that. There is a period of transition, because what we’re doing is very big. We’re bringing wealth back to America. That’s a big thing. And there are always periods of, it takes a little time. It takes a little time, but I think it should be great for us,” Trump said.When asked whether he thought his tariffs on US imports would fuel inflation, he said: “You may get it. In the meantime, guess what? Interest rates are down.”He downplayed recent stock market volatility that followed his ducking and weaving over tariff policy on exports from Canada, Mexico and China and similar threats to other countries, despite his usual fixation with market performance in relation to the politics of the day and an appetite to claim credit when stocks rise on his watch.“You have to do what’s right,” he said.Last week the Atlanta Federal Reserve suggested that the US economy is on course to contract in the first quarter, triggering fears a recession could hit the world’s largest economy if weakness persisted and fueling stock market jitters.In 2018 Trump posted on Twitter, now X, that “trade wars are good, and easy to win”, a view that is not widely shared by financial and economic experts.On Sunday, however, he was cautious overall after boasting throughout his election campaign of the swift gains his policies would bring for the US economy and ordinary Americans’ finances.Fox News Sunday Morning Futures anchor Maria Bartiromo introduced the topic of recession by telling Trump “look, I know you inherited a mess”, even though most experts agree that predecessor Joe Biden, a Democrat, left the Republican president a stable economy where inflation, although painfully high for a long time, was continuing to come down and international trading conditions for the US were steady.Meanwhile, also on Sunday morning, NBC’s Meet the Press TV politics show was interviewing US commerce secretary Howard Lutnick.He pushed back on concerns that the prospect of Trump’s global tariffs would cause a recession in the US. “Absolutely not,” he said. “There’s going to be no recession in America.”Lutnick added: “Anybody who bets against Donald Trump, it’s like the same people who thought Donald Trump wasn’t going to win a year ago … you are going to see over the next two years the greatest set of growth coming from America … I would never bet on recession, no chance.”
Reuters contributed reporting More
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Trump policies could fuel illicit drug trade despite vow to curb fentanyl
Donald Trump’s policies could leave the US more vulnerable to dangerous synthetic drug trafficking from abroad, even as the administration has vowed to stop fentanyl from entering the country, former government officials say.This week, Trump imposed tariffs on Mexico, Canada and China, ostensibly as a tactic to stem the flow of illicit drugs into the US.Jim Crotty, the former Drug Enforcement Administration deputy chief of staff, called the approach “coercive” and said it has the potential to backfire. Federal funding cuts could also leave US borders more insecure, according to Enrique Roig, a former Department of State official who oversaw Bureau of International Narcotics and Law Enforcement Affairs (INL) portfolios and who has also worked with USAid.US overdose deaths began to decrease significantly for the first time in 2023, after rising for decades. But Crotty notes this progress is fragile.“We’re seeing this decrease in overdose deaths and everyone’s still trying to suss out exactly why. I don’t think now is the time that we want to stop any of those existing efforts because we know that at least some, or a combination of them, have been working,” Crotty said.Roig agreed: “All this has to be working together in concert.”Federal funding cuts could put the US behind when it comes to drug detection technology. The global drug supply has increasingly shifted towards highly potent synthetic substances such as fentanyl and newly emerging nitazenes. Often, these drugs arrive in the US in the form of powders or precursor chemicals that take up minimal space, and are difficult to detect by odor.Roig says advanced drug detection technology is therefore vital, but Trump’s federal funding and staff cuts mean less money for the latest technology and equipment, and fewer people to install it.Ram Ben Tzion, the CEO of Publican, which provides drug detection technology to government agencies outside the US, says cutting-edge methods detect suspicious shipments even before they get to the border. Publican uses large language models to flag shipments that “don’t make sense” and are likely to contain illicit substances. For example, his company once found fentanyl precursors in a shipment to a residential address in California. The shipment claimed to contain fashion items, but came from a Chinese construction company.Similarly, the UN Container Control Programme, which has historically received state department funding, helps authorities flag suspicious shipments before they reach their destination. This program has helped authorities around the world seize hundreds of tonnes of illicit drugs each year. Roig says federal funding cuts have stalled CCP’s implementation in Mexico, even though it’s a primary security target for Trump.Some of Trump’s measures are more showy than they are constructive, Crotty and Roig said. The designation of certain cartels as terrorist organizations “doesn’t do much of anything”.It’s symbolic, says Crotty, given that they were already designated transnational criminal organizations. Other measures are a harmful waste of money, according to Roig. Just this week, for instance, the administration suspended the use of military planes to deport immigrants, including those accused of drug related crimes, due to the extravagant cost.Roig says this measure was completely unnecessary, as “Ice already has its own fleet of airplanes” that are much cheaper.Crotty is concerned the aggression could backfire.“The Mexican people are protective of their culture and their sovereignty. If you push them too hard, could it do more harm than good?” he said.Mexico sent 10,000 troops to its US border to cooperate with Trump’s demands, but Crotty says “while in a vacuum that sounds like a whole lot”, Mexico’s border is vast, and drugs are often transported in “minute quantities”. So, the US needs Mexico’s cooperation when it comes to intelligence – otherwise “you’re not going to find the proverbial needle in the haystack”, Crotty said.Roig said that “it’s important that we do this in cooperation with Mexico and not alienate them,” adding that Trump’s aggressive stance toward China could harm the Biden administration’s progress negotiating with the Chinese government to cooperate on counternarcotics initiatives.Massive USAid cuts also threaten programs intended to curb the “root causes” of the drug trade, says Roig. Some USAid-funded programs simultaneously tackled drug smuggling and another one of Trump’s key issues, migration – as cartels that traffic drugs also traffic people.When Roig worked with USAid, he says he spent a lot of time on “community violence prevention efforts”, including programs to keep young people from joining international crime organizations and cartels. (Notably, the Trump administration has purged many websites describing USAid programs.)If the drug supply does increase, it could mean US overdoses begin to rise again as well. But Crotty is worried we won’t even know if that happens. Layoffs at the Centers for Disease Control and Prevention could leave fewer people to track overdose deaths, and Trump’s attack on government data sharing could keep everyone in the dark.“ CDC maintains the overdose death dashboard. A lot of that stuff is data driven. Are they still going to have access to the data?” he said.The Guardian contacted INL and UNODC for comment. More
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Trump administration briefing: Trump changes tack on tariffs – again – as US plans to close consulates
Donald Trump has performed another reversal on tariffs, delaying duties on many goods from Canada and Mexico again. Trump said the reversal has “nothing to do” with turbulence in the stock market in recent days, as investors weighed his economic plans. On Wall Street, the S&P 500 fell 1.8% on Thursday. “I’m not even looking at the market,” he claimed.It was also a day where the focus fell on the power wielded by Elon Musk and the president’s plans for US consulates in Europe. Trump shelves Canada-Mexico tariffs – for a timeDonald Trump pulled back from his trade war with Canada and Mexico on Thursday, temporarily delaying tariffs on many goods from the two countries once again. Two days after imposing sweeping tariffs on all imports from his country’s closest trading partners, the US president announced that duties on a wide range of products would be shelved until April.Read the full storyElon Musk says he isn’t to blame for mass firings of federal workersElon Musk is telling Republican lawmakers in private meetings that he is not to blame for the mass firings of federal workers that are causing uproar across the country, while Donald Trump reportedly told his cabinet secretaries on Thursday that they are ultimately in charge of hiring and firings at their agencies – not billionaire aide Musk.The men appeared to be making parallel efforts to distance Musk from radical job slashing made over the last two months. This despite the tech entrepreneur boasting about cuts, recommending the US “delete entire agencies” and taking questions on the issue alongside the US president, then wielding a chainsaw at an event to symbolize his efforts – all amid legal challenges and skepticism from experts.Trump said on Thursday he has instructed department secretaries to work with Doge but to “be very precise” about which workers will stay or go, using a “scalpel rather than a hatchet”.Read the full storyUS plans to close European consulates and cut state department workforceThe US state department is preparing to shut down a number of consulates that are mainly in western Europe in the coming months and looking to reduce its workforce globally, multiple US officials said on Thursday.The state department is also looking into potentially merging a number of its expert bureaus at its headquarters in Washington that are working in areas such as human rights, refugees, global criminal justice, women’s issues and efforts to counter human trafficking, the officials said.Reuters reported last month that US missions around the world had been asked to look into reducing US and locally employed staff by at least 10% as Donald Trump and his billionaire aide Elon Musk have unleashed an unprecedented cost-cutting effort across the US federal workforce.Read the full story‘Not a king’: Trump is told firing of labor chief is illegalA federal court ruled that Trump’s abrupt firing of a former senior official at the top US labor watchdog was illegal, and ordered that she be reinstated. Gwynne Wilcox was the first member of the National Labor Relations Board to be removed by a US president since the board’s inception in 1935.The framers of the US constitution “made clear that no one in our system of government was meant to be king – the president included – and not just in name only”, the judge Beryl A Howell, wrote in the ruling.Read the full storyMusk and Texas governor celebrate after worker fired over pronounsThe Texas governor, Greg Abbott, and, later, Elon Musk showed support on Wednesday for the firing of a state employee who refused to remove his pronouns from his work email signature. Frank Zamora, 31, was let go from his job as a program manager at the Texas real estate commission.Abbott celebrated the move on X. Musk then replied to Abbott’s post with two fire emojis.Read the full storyUS attorney threatens top law school over DEIA Trump-appointed US attorney has told Georgetown – one of the country’s top law schools – to immediately end diversity, equity and inclusion (DEI) efforts, warning that his justice department office will not hire students or other affiliates associated with a university that utilizes DEI.In an extraordinary letter sent to the dean, the recently appointed interim US attorney for the District of Columbia, Ed Martin, said he was investigating the academic institution after it had come to his “attention reliably” that they were teaching and promoting DEI.Read the full storyDoJ investigating California universities over alleged antisemitismThe US Department of Justice is investigating the University of California system for possible antisemitic discrimination after demonstrations against Israel’s war in Gaza took place on campuses last year.Read the full storyDemocrats join in censure of Al GreenThe House voted on Thursday to censure Al Green for disrupting Trump’s joint session address, with a handful of Democrats voting to condemn the Democratic Texas representative along with Republicans.The House voted 224-198, with 10 Democrats voting in favor of the censure, which accuses Green of a “breach of proper conduct”.Read the full storyCanadians protest against US toxic wasteThe proposed expansion of a Quebec landfill that accepts hazardous waste from the United States has ignited a turf war between the Quebec provincial government and local leaders, who say they oppose putting US trash into a local peat bog. Local leaders are protesting against the move – saying the province is capitulating to a US company in the midst of a tariff war between Canada and the United States.Read the full storySmall US agency stands up to MuskMembers of Elon Musk’s so-called “department of government efficiency” (Doge) unit were barred from entering a small, independent federal agency promoting economic development in Africa on Wednesday after a tense standoff with federal staff they had been sent to fire.Workers at the US African Development Foundation (USADF), which Donald Trump has ordered to be closed, refused to allow Doge operatives to enter after they arrived at its Washington headquarters.Read the full storyWhat else happened today:
In an escalation of his pressure campaign, Trump said the US will not fight for Nato allies who don’t spend enough on their own defense. “I think it’s common sense,” the president said. “They don’t pay, I’m not going to defend them.”
The state department is hunting for evidence that foreign students who express support for Palestinians under Israeli occupation while studying in the US are “pro-Hamas”, and can have their visas revoked, based on an AI review of their social media accounts, Axios reports.
Trump told reporters in the Oval Office that he will “probably” extend TikTok’s deadline to find a US buyer or face a ban.
Catching up? Here’s what happened on 5 March. More
