Lagarde highlighted the importance of a negotiating approach to US tariff threats. He proposed favoring dialogue instead of a strategy of retaliation that could harm both parties.
Christine Lagardepresident of European Central Bank (ECB)in an interview given this Thursday to Financial Times. He indicated that he prefers to negotiate with the president-elect, Donald Trump, than to enter into a trade war that would end up harming Europe.
The banker added that “Donald Trump clearly announced last week the magnitude of the tariffs he has in mind: 60% for China, 10-20% for the rest of the world. “But he hasn’t been very specific about the scope and basis on which those tariffs would be applied.”
In his opinion, “tariffs applied broadly and indiscriminately produce certain effects, but highly selective and specific tariffs will produce a different effect. It is one thing if tariffs are increased on certain categories of products, as I believe the administration has done.” American, for example, with electric vehicles. Another is whether they apply broadly to everything that crosses the border.. We still have no idea about these details.”
Christine Lagarde and Donald Trump.
Christine Lagarde and Donald Trump.
Lagarde added that “when it comes to tariffs on European imports (between 10 and 20%), there is a 100% difference between the two.”. That’s also interesting. I think it’s indicative of the approach that President-elect Donald Trump supposedly tends to take, which is to negotiate. The fact that a range is set means it is open to debate. “It’s open to a different distribution of that tariff depending on what the base will be.”
Lagarde’s words and the message between the lines
In this sense, the leader specified that “the European Commission has indicated that it is preparing, which is good. We could offer to buy certain things from the United States and imply that we are willing to come to the table and see how we can work together. “I think this is a better scenario than a purely retaliatory strategy, which can lead to a tit-for-tat process in which no one really wins.”
Finally, he recalled that “the last time, when it was threatened to impose tariffs on Europe (on all categories of steel), the European Commission adopted the position of sitting down to talk, not to retaliate, but to negotiate.”
Source: Ambito
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