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16:52

2019-09-20

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Donald Tramp is ready to begin new trade war. For this time with Europe

    • What does it threaten and will there be answers from the side of European Union?

      We will remind that to quite recently Donald Tramp has established a state duty 10% for import of all Chinese commodities in the amount of more than 300 milliard dollars. He reported at the same time, that in the nearest future the size of duties will attain 30% for commodities by a cost from a 250 milliard of dollars. In reply China established the duties 5-10% for commodities from the USA the blanket price of that exceeds 75 milliards of dollars.

      This event strongly caused to fall a petroleum market and inflicted an imposing blow to the economy of not only the USA and China but also other countries. It would seem, it was worth stopping … but.

      Donald Tramp seriously intends to unleash a trade war with Europe

      Not surprisingly, the prerequisites for this were found in the official Twitter account of the US president. In compliance with the source the USA President in his Twitter quoted a known businessman Samuel Zell having written there: "Europe always has been among those, which pursue a protectionism policy. They are playing from behind being concerned whether they are the next ones to be exposed to such establishment”. Afterward Donald Tramp highlighted: “It might happen!”.

      Does that mean that Trump is really ready to commence a trade war with the European Union? Provided yes, what will be the consequences like for everyone?

      Before digging into the issue, we suggest you getting familiar with the cases and consequences of trade wars in the world. We have collected a brief take away of the most interesting.

      The first thing that awaits us is the rapid drop-down in the price of raw materials, primarily for gas and oil. But this is only a small part of the possible consequences.

      Everyone quite understands that the trade war between the United States and Europe is only a matter of time. For some time it was put aside. To be precise, not so long ago, the introduction of 25% of duties on cars and spare parts from the European Union was postponed. Such a decision could affect Germany first of all. And the problem is that Trump may well be interested in this, since he has accused Germany of buying Russian gas repeatedly.

      Now it is becoming clearer, that Trump is ready to act decisively and in the nearest future. The outbreak of economic trade war can cause severe turbulent phenomena.
      Makes sense to remind that the trade war with China stroke a blow against the economy of the Old World but not much affected Europe. However, now it is European countries that are at a risk of being eroded economically.

      To make the matter worse, the results can be the most fatal

      every third medium and large European country will notice an economic blow

      the number of bankrupt enterprises will increase rapidly

      unemployment rate will go up as well, especially taking into account the rapid growth in the number of migrants to European countries

      trade relations between the USA and Europe will be disrupted, trade will become unprofitable for any volume

      the cost of imported goods and raw materials will increase both in the USA and in Europe

      possible destabilization of the exchange rate might take place, which will affect not only the States and Western Europe, but also the countries of Eastern Europe.

      As a result, imported goods in local markets will simply become uncompetitive. Of the same quality, they will cost as much as 10-25% more, due to the thing that they won’t be of a great demand. And this subsequently continues to destroy trade relations. And at the same time, the number of monopolistic companies is increasing, which is bad not only for the state, but also for the final purchaser.

      What is ought to be done in such a situation? What does the economic war of the USA and Europe threaten for you personally? Is it worth to alert of anxiety or economic confrontation - is this a normal state of affairs in the 21st century? You will find the answers to all these questions in our essay on the economic confrontation between the United States and the European Union.

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