With just days to go before President Donald Trump’s “reciprocal” duties on dozens of United States trade partners are set to take effect, the Commander in Chief is issuing a stern warning to those that have brokered deals: keep up your end of the bargain—or else.
Speaking about two of the more notable deals struck over the course of the past two weeks with Japan and the European Union on CNBC’s Squawk Box on Tuesday, Trump reiterated claims that the countries have agreed to funnel billions of dollars of investment into the U.S. market, and threatened the EU with higher duties if it doesn’t pay up.
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Japan agreed to a $550-billion “signing bonus,” the president said, calling the funds “our money to invest as we like.” Likewise, the EU has agreed to invest $600 billion into U.S. industry and purchase $750 billion in American energy, he added.
Asked what might happen if the EU doesn’t uphold the terms of the deal (for which details remain scant), Trump said he would up duties on the trade bloc to 35 percent.
Heated negotiations saw the president threaten Europe with 30-percent duties in July. Last week, those tensions finally cooled, and Trump was able to reach a deal with European Commission president Ursula von der Leyen during a trip to Scotland. Beginning Thursday, European goods will face 15-percent tariffs.
According to a White House fact sheet on the “colossal” deal, Europe will draw down its trade barriers, zeroing out tariffs on U.S. goods and enabling agricultural and industrial products into 27 countries duty free. It isn’t immediately evident what the sizable investment promised by the trade bloc will go toward.
Trump on Tuesday also threatened Europe with new tariffs on pharmaceuticals that could escalate to 150 percent within the next year and a half, and 250 percent sometime thereafter.
