The six non-U.S. members of the Group of Seven industrialized nations are against Trump’s recent trade decisions.
Their statement follows several decisions made by the White House, the primary one being the decision to raise tariffs up to 25% for steel and 10% for aluminum to the E.U., Canada and Mexico, out of concern for national security.
The country’s G-7 allies stated that the decision “[undermines] open trade and confidence in the global economy.” It is quite uncommon that only one member of the Group is singled out for its policies and procedures, especially when it comes to the U.S. The country had been previously considered the leader and ambassador of free trade.
According to the Wall Street Journal, U.S. Treasury Secretary Steven Mnuchin said that the country is still committed to its “leadership in the global economy,” and added that both national security is also one of President Trump’s priorities. G-7 members have shown themselves very skeptical to this statement: they believe that it is “absurd to think that Canada [one of the countries affected by the recent tariff implementation] could in any way be a security risk to the United States.”
Forwarding this idea, Canadian Prime Minister Justin Trudeau stated:
“One of the things that I have to admit I’m having a lot of trouble getting around is the idea that this entire thing is coming about because the president and the administration have decided that Canada and Canadian steel and aluminum is a national security threat to the United States. The idea that we are somehow a national security threat to the United States is quite frankly insulting and unacceptable.”
White House economic adviser Larry Kudlow responded to Trudeau’s statements by saying that, while the new tariffs may affect the U.S. economy, he highly doubts they will affect or deteriorate the countries’ relationship. However, Canada, Mexico and the E.U. have opened a case against the U.S. with the World Trade Organization (WTO), stating that the country has “violated the rules of the international system.”
Specialists have been led to believe that, if the WTO were to move the case forward, it is likely that they would side against the United States. Georgetown law professor and former WTO member Jennifer Hillman has stated that even though the U.S. could make a case to be exempted of the tariff regulations in certain occasions, “it’s not clear that these steel or aluminium tariffs fall under any of these boxes.”
Another tariff-related decision by the Trump administration that raised concern was its plant to implement a baffling 25% tariff in 50$ billion worth of Chinese goods. It came after several statements from the U.S. indicating that the “trade war” had been put to a halt while the negotiations were taking place.
Ultimately, though, the White House announced that: “The United States will implement specific investment restrictions and enhanced export controls for Chinese persons and entities related to the acquisition of industrially significant technology.” The tariffs were targeted to complicate China’s access to “industrially significant technology” in the U.S. They have been designed as a response to what the White House has described as unfair trade practices from the country.
China has stated that they would also apply harsh trade levies to energy and farming products purchased from the U.S, which is of high interest to the Trump administration.
This set of concerns by the G-7 has also increased in face of next week’s meeting between the nation’s leaders, which will address the U.S.’ recent actions.
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