Europe should build autos in US to avoid tariffs: Trump

WASHINGTON: President Donald Trump said on Friday he was using the threat of tariffs to pressure European manufacturers to build more autos in the United States.

In a televised interview Trump also denied that trade talks with China had hit a bump in the road, saying they were nearing a conclusion.

The comments aired on Fox Business come as Washington pursues its long-running multi-front trade confrontation with the world›s largest economic blocs.

US President Donald Trump said trade negotiations with china were progressing and a final agreement «will probably happen,» adding that his call for tariffs to remain on Chinese imported goods for some time did not mean talks were in trouble.

Trump, in a television interview aired on Friday, also said he expected to keep a 25 percent tariff on European light trucks amid separate ongoing trade talks with the European Union, but that companies could avoid it by building factories in the United States.

The Trump administration is engaged in ongoing trade talks with both the European Union and china as part of the Republican president›s «America First» agenda. Top U.S. officials are headed to Beijing in coming days, with a summit possible between Trump and Chinese President Xi Jinping to seal any final deal.

“The European Union ... frankly, treats us as badly as china,» Trump told Fox Business Network.

“Our deal is coming along very well. We›ll see what happens,» Trump said regarding china. «I think the deal will probably happen. I think they need it very badly.”

Asked about his remarks earlier this week about U.S. tariffs on Chinese goods staying in place for a period of time and whether that meant there was a snag in the negotiations, Trump said, «No, not at all.»

Trump then segued to the European auto sector, including trucks. «We get a 25 percent tariff on that segment — that›s our best segment by far. And yes, we will absolutely be able to keep it - not only keep it going, I really think we have tremendous potential,» he told the network in the interview, which was taped on Thursday.

«I’ll tell you what the end game is. They’ll build their plants in the United States and they have no tariffs,» Trump added. Then, asked if he would agree to zero tariffs, he said: «I would do it for certain products, but I wouldn’t do it for cars.»

Top trade negotiators are due to begin a fresh round of talks in Beijing next week and the White House is also considering imposing punishing duties on automobile imports on national security grounds − something economists say could send shockwaves through the global economy.

«I›ll tell you what the end game is. They›ll build their plants in the United States and they have no tariffs,” Trump told the network. Foreign automakers often point out that a significant share of their vehicles are already manufactured in the United States, either for domestic consumption or for export to third countries.

Industry representatives also fear such tariffs would invite retaliatory measures hurting US exports.

The White House received last month a Commerce Department report on the auto industry that, two people familiar with the matter told AFP, concluded that auto imports pose a national security threat.

After receiving the report, Trump has until around mid-May to decide whether or not to impose tariffs.

Washington has used national security arguments to justify tariffs on aluminium and steel imports, which has drawn outraged responses from traditionally-allied trading partners.

Trump said Friday that threat came from imbalanced trade itself: «What poses a national security risk is our balance sheet,» he told Fox Business.

He added that he was disinclined to agree that both the US and EU should reduce all auto tariffs to zero.

«The problem is that the Chevrolet will never be accepted in Europe like the Mercedes is accepted here, so it›s not a good deal,» he said.

He also told the network he wanted to keep the current 25 per cent duties on a $50 billion tranche of Chinese imports.

«We want to keep that because we need that,» he said. «We will absolutely be able to keep it.» Trump previously said he expected to seal any final bargain at a summit with Chinese President Xi Jinping later this month, but that expectation has faded as momentum in the talks slowed.

«I think we›re getting very close,» Trump said, adding that a successful outcome was nevertheless not guaranteed.

Meanwhle, Italy and China want to revive the spirit of the ancient Silk Road by deepening their trade and investment ties, Chinese President Xi Jinping said on Friday during a trip to Rome that has raised eyebrows in Washington.

Xi is set to sign a deal on Saturday that will see Italy become the first member of the Group of Seven major industrialised nations to join China›s «Belt and Road» infrastructure project (BRI), which is inspired by historic, centuries-old trade routes.

Reuters