Donald Trump’s plan to impose taxes of up to 25 per cent on imports of steel and aluminium would damage the US economy as well as America's trading partners around the world, the International Monetary Fund has warned.
The financial organisation said the import restrictions could lead to other countries imposing similar tariffs for reasons of national security.
“The import restrictions announced by the US President are likely to cause damage not only outside the US, but also to the US economy itself, including to its manufacturing and construction sectors, which are major users of aluminium and steel,” said IMF spokesperson Gerry Rice.
“We are concerned that the measures proposed by the US will, de facto, expand the circumstances where countries use the national-security rationale to justify broad-based import restrictions.
“We encourage the US and its trading partners to work constructively together to reduce trade barriers and to resolve trade disagreements without resort to such emergency measures.”
Canada and the EU have already vowed to introduce their own countermeasures and Mexico, China and Brazil said they were also considering retaliation.
European Commission president Jean-Claude Juncker told German television that the EU will put tariffs on “Harley-Davidson, bourbon and blue jeans”.
The Swedish company Electrolux has already delayed a $250m investment in the US state of Tennessee because of the tariffs.
China's Commerce Ministry said Trump's plan would "seriously damage multilateral trade mechanisms represented by the World Trade Organisation and will surely have huge impact on normal international trade order."
But the US President defended the proposals to impose duties of 25 per cent on steel and 10 per cent on aluminium as early as next week by tweeting that “trade wars are good, and easy to win”.
He said: “We must protect our country and our workers. Our steel industry is in bad shape. IF YOU DON’T HAVE STEEL, YOU DON’T HAVE A COUNTRY.”
The International Monetary Fund (IMF) describes itself as “an organisation of 189 countries, working to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world.”
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