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Free AccessMNI BRIEF: China November PMI Rises Further Above 50
MNI US Macro Weekly: Politics To The Fore
REPEAT: MNI: Italy To Push EuCo For EU-Wide US Tariffs Plan
Repeats Story Initially Transmitted at 18:12 GMT Mar 13/14:12 EST Mar 13
--Upcoming EuCo Likely To Discuss A Common EU Stance: Govt Official
--'Soft Power' May Not Be Enough, But 'Hard' Power Last Resort
--A New Era Of Trade Disputes Are A Danger Best To Avoid
By Silvia Marchetti
ROME (MNI) - Italy will likely push for a European-wide plan to address any
U.S. import duties imposed on the European Union to help avoid negative economic
repercussions across the bloc, a senior Italian government official told MNI.
"We aim to rally consensus among peer countries at the upcoming European
Council meeting on Mar 22-23 to define a common stance and possible steps
forward. But this is an extremely delicate and hazardous situation that requires
utmost prudence," said the source.
Prime Minister Paolo Gentiloni last week discussed the turn of events in
global trade policies with European Commission president Jean-Claude Juncker.
Rome, in line with the rest of the bloc, believes import duties are not the
correct way forward and that it is paramount to pursue dialogue with the U.S. to
define a clear trade framework.
"European states' concerns and commercial interests are the same. We all
want to avoid the U.S. extending its new import duties to key European products,
and not just agriculture. For now, the duties concern steel and aluminium
imports mainly from China, let's just hope there's no extension otherwise we
would need to step-up a common offensive," the official said.
It's not just a matter of raising Europe's voice through stronger 'soft
power', he warned. "That might not be enough anymore. The US administration's
protectionist measures were announced over a year ago and now they appear to
finally strike. Europe has always kept its dialogue channels open".
--WORST CASE
The worst case scenario, were all diplomatic routes to fail and the U.S.
duties be extended to the EU, is that of resorting to different forms of 'hard
power' with potential retaliation on key US imports.
"The outlook is very uncertain: but there's a risk that if things do go
bad, Europe would be forced to place duties on American imported goods and then
we'd be back to the era of commercial disputes of past decades," argued the
source.
The last thing both the U.S. and the EU need, he added, is a return to
endless reciprocal appeals filed to the World Trade Organization (WTO).
Talks between European and American representatives are currently facing
deadlock and coming days are set to be crucial for the future of transatlantic
trade relations.
Brussels hasn't yet abandoned the path of dialogue, but tensions on both
sides of the Atlantic are mounting and the official warned "time could be
running out".
--FERRARIS AND FASHION
Rome is worried about the impact of possible U.S. import duties on
'Made-in-Italy' products, mainly autos, machinery and fashion.
According to recent data, Italy has doubled its export volumes to the US
over the last decade. Last year Italian exports to the US reached a record peak
volume of E25 billion, with steel products accounting for over 10% of total
European sector exports, up 19% from 2016.
The bilateral trade balance currently favours Italy. Rome's Economic
Development ministry reports that since 2009 Italian exports to the U.S. have
risen 137% versus just a 58% rise for U.S. exports to Italy.
"The European Central Bank has repeatedly warned of the negative impact
global protectionist measures could have on the eurozone's outlook and one thing
is clear: Europe will not sit and watch in a critical moment when its economy is
finally growing again,", said the official.
--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com
To read the full story
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Please enter your details below.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.