Poland’s Foreign Minister, Radek Sikorski, says the EU’s response to Donald Trump’s tariffs will be “measured, professional and clever”.
He says the European Commission is now considering its response – “and we have some very competent people working on it”.
He will not give details of what that response might involve.
Speaking to the BBC, Sikorski describes the imposition of tariffs as “a new departure” for the US – which he says had been the leader for decades in promoting free trade, through the General Agreement on Trade and Tariffs (GATT) and the World Trade Organization (WTO).
Sikorski says the new tariffs, announced by President Trump, are “a massive decision” and “we haven’t found the positives yet”.
Poland’s prime minister, Donald Tusk, says the tariffs could cost Poland losses of more than $2.6bn dollars. He calls it a “severe and unpleasant blow” on X.
WTO chief says tariffs will have substantial impact on global trade
The head of the World Trade Organization (WTO) says these tariffs “will have substantial implications for global trade and economic growth prospects”.
In a statement Dr Ngozi Okonjo-Iweala says she is “deeply concerned about this decline and the potential for escalation into a tariff war with a cycle of retaliatory measures that lead to further declines in trade”.
In a sharp revision of its previous forecasts the WTO now says that it’s expecting the volume of global trade to shrink 1% this year.
This compares to the previous forecast of 3% growth that it made in October.
President Trump’s global tariffs are the biggest shock to the WTO system for governing global trade in its 30-year history but the Geneva-based body says its rules still govern about 74% of all global trade.
Many countries have “reached out” to the WTO’s leadership with questions but if President Trump ignores it, as he has done in the past, retaliatory tariffs may be one of the few options they have even though Dr Okonjo-Iweala wants it to be a platform for resolving their differences as it was set-up to do.
Mexico not imposing tariffs on US, says Sheinbaum
Mexican President Claudia Sheinbaum began her daily press briefing by saying that Mexico would not be imposing any tariffs on the US.
The fact that Mexico and Canada had largely been left out of the new tariffs announcement from the White House, she said, was “good for the country” and testament to the strength of their bilateral relationship.
However, many in Mexico are unsure whether the country’s vital car manufacturing industry would be affected by the decision – or exempted under the rules of the USMCA regional free trade agreement.
The country’s finance minister, Marcelo Ebrard, said the vast majority of the Mexican automotive industry – 84%, he claimed – conformed with USMCA rules and therefore should avoid the 25% tariff on foreign-made cars being imposed by the US.
Mexico currently sends around $200bn (£152bn) worth of assembled cars to the US each year, around 40% of its total annual exports. It is also the leading provider of car parts to the US.
The most immediate impact will be felt by people in America in the form of higher prices.
In the first instance, the tariffs are paid at the more than 300 border crossings, ports and airports where companies bring goods in from abroad.
Those extra costs will squeeze profits along the supply chain and invariably – at least partly – will end up being paid for by American consumers.
In other parts of the world, a slowdown in demand from American consumers could lead to fewer jobs if companies currently supplying America can’t find somewhere else to sell their stuff.
A major catalyst for American companies getting their goods from Asia was China opening up to foreign companies in the late 1970s and offering cheaper options.
That meant a dramatic decline in US manufacturing and one of President Trump’s big hopes is that he can reverse that movement.
However, not everything can be made in the US, and even if it can it will take time and significant financial commitment from the companies involved.
How well those goods can then compete on price remains to be seen.
