Trump to leave G7 early, tensions high after 'rant' over trade

Clay Curtis
June 10, 2018

US President Donald Trump proposed the complete elimination of all barriers to worldwide trade at a Group of Seven summit, a move that turns the tables on allies who accuse the US of wielding protectionist policies. I mean, we have India, where some of the tariffs are 100 percent.

"Canadians are polite and reasonable but we will also not be pushed around" - host Prime Minister Justin Trudeau tells a post-summit press conference of his plans to impose his own tariffs on USA imports in retaliation to similar measures by Trump.

Asked whether Canadian Prime Minister Justin Trudeau's team was engaged in frantic damage control, a Canadian government official said it was always clear there would be disagreements at the summit over trade and relations with Russian Federation.

"We're like the piggy bank that everybody is robbing, and that ends", said Trump.

"The Prime Minister said nothing he hasn't said before - both in public, and in private conversations with the President", the Prime Minister's Office said in a statement.

Trade dominated the two-day summit that began on Friday with leaders of Germany, France, Japan, Canada, Britain and Italy returning to the topic repeatedly in meetings, at a lavish dinner and by a fireside pit late into the evening.

Should the NAFTA talks fail, Trump repeated that the United States would consider separate bilateral trade deals with Canada and Mexico.

"No tariffs, no barriers, that's the way it should be, and no subsidies", Trump said during a 30-minute press conference on the sidelines of the meeting in La Malbaie, Quebec.

"We stick to the communique as agreed by all participants", a European official said on condition of anonymity. He said other world leaders reacted positively to the idea.

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In an "extraordinary" exchange between the leaders on Friday, Trump repeated a list of grievances about USA trade, mainly with the European Union and Canada, a French presidency official told reporters. "And no subsidies. I even said, "no tariffs", Mr Trump said, while defending his decision to impose a global tariff on United States imports of steel and aluminium.

"It allowed a dialogue, where for weeks there were uncoordinated unilateral actions and non-cooperation".

Trump followed it up with a second post that targeted Canada's auto and dairy industries: "PM Justin Trudeau of Canada acted so meek and mild during our @G7 meetings only to give a news conference after I left saying that, "US Tariffs were kind of insulting" and he 'will not be pushed around.' Very dishonest & weak".

He said he suggested cutting all of the tariffs, duties and even government subsidies among the G7 countries, and said other leaders would "go back to the drawing board and check it out".

The prospect that he could be moving toward an even greater protectionist trade policy is likely to chill financial markets anxious about tit-for-tit escalation that could lead to a full-blown global trade war.

The trade spat dominated the meeting, with Canadian and European leaders threatening retaliatory duties in response to the United States levies. Canada has promised retaliatory measures on July 1.

Canada, Mexico and the European Union also are moving ahead with their own levies on USA goods.

The EU said it will impose the "rebalancing" tariffs on about $3.3 billion (2.8 billion euros) worth of US steel, bourbon, agricultural products including sweet corn, orange juice, cranberries and certain clothing made of cotton. This will be the first time a sitting U-S president meets with a North Korean leader.

Several of the leaders responded aggressively to Mr Trump's demands, listing their own complaints about U.S. policies on tariffs and other trade measures, the official said.

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