Paris (Reuters) – Trade tensions with the United States are the start of a “march towards independence” for Europe, estimates Christine Lagarde, president of the European Central Bank (ECB) on Monday.
“We are two days of deep geopolitical and especially geo-economic changes decided by the American president. And I consider that it is the beginning of a march towards independence,” said on France Inter Christine Lagarde, referring to the so-called reciprocal customs duties that the United States intends to set up on Wednesday.
“He (the American president, Donald Trump), he calls it ‘Liberation Day’ in the United States. I consider that it is a time when we have to decide to take better hand. And I think it is a walk towards independence,” she insisted.
Donald Trump has already announced last week the implementation of customs duties of 25% on imports of cars in the United States and new surcharge should receive many other sectors from Wednesday, at the risk of triggering a world trade war.
“We are in an existential moment for Europe. We must absolutely take control of the reins now,” said Christine Lagarde, believing that Donald Trump’s policy in terms of customs duties could reduce the growth of the gross domestic product (GDP) this year from the euro zone by at least 0.3 percentage points.
“If we apply reciprocity and if we respond with customs duties that we would apply in the United States, the drop in GDP, that is to say, European economic wealth, it descends to at least 0.5 percentage point,” she added, stressing that all this is “surrounded by a lot of uncertainty”.
(Written by Claude Chendjou, edited by Blandine Hénault)
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