Donald Trump has rejected Theresa May’s “deep concern” over his plan to impose tariffs on steel and aluminium imports into the US.
In a telephone conversation, the prime minister urged the President to cool the escalating war of words between Washington and the European Union.
She told him that “multilateral action was the only way to resolve the problem of global overcapacity in all parties’ interests.”
However, Trump dismissed her plea, posting on Twitter: “We are on the losing side of almost all trade deals. Our friends and enemies have taken advantage of the U.S. for many years. “Our Steel and Aluminum industries are dead. Sorry, it’s time for a change! MAKE AMERICA GREAT AGAIN!”
UK Cabinet Office minister David Lidington said: “I just think that the United States is not taking an advisable course in threatening a trade war. Trade wars don’t do anybody any good.”
Trump has also threatened to increase taxes on European cars if the EU retaliates against his steel and aluminium tariffs by imposing tariffs on such products as Kentucky bourbon, Levi’s jeans and Harley-Davidsons .
In retaliation, Trump tweeted: “If the EU wants to further increase their already massive tariffs and barriers on US companies doing business there, we will simply apply a Tax on their Cars which freely pour into the U.S. They make it impossible for our cars (and more) to sell there. Big trade imbalance!”
He also hit out at “very stupid” trade deals by earlier administrations and said other countries “laugh at what fools our leaders have been. No more!”
It is not clear whether a European car tariff would include British-made cars such as Aston Martin or Jaguar Land Rover, which is owned by Indian company Tata but produced in the UK, after Brexit.
The tit-for-tat row started when Trump announced that he would impose stiff tariffs of 25% on steel and 10% on aluminium imports from anywhere in the world.
But his threat to further tax cars and metals may be difficult to pull off. The current tax on European cars was decided through complicated international negotiations so to increase it the President may have to pull the US out of the World Trade Organisation.