Trade War Fallout: 5 ways the Trump tariffs could impact air cargo

US President Donald Trump

US President Donald Trump

Together the trade battles have raised the spectre of a global trade war, spooking financial markets that fear major consequences to the world economy.

The European Union slapped revenge tariffs on iconic US products including bourbon, jeans and motorcycles on Friday (June 22) in its opening salvo in a trade war with US President Donald Trump.

What happens in this regard is a possibility of trade diversion.

And the EU's trade chief Cecilia Malmstrom said she was "very worried" the row with Mr Trump could trigger a "full trade war". Mainly because we need to find our own sense of agencies.

Case in point: Daimler AG late Wednesday slashed its earnings outlook for the year, saying fewer Chinese consumers will buy Mercedes-Benz SUVs because of tariffs Beijing is slapping on autos imported from the US.

"It is deeply regrettable that the US has been capricious, escalated the tensions, and provoked a trade war", Chinese Commerce Ministry spokesman Gao Feng said on Thursday.

Its duties target goods worth $3.3bn (£2.5bn) after the United States imposed tariffs on the bloc's steel and aluminium.

Trump has also started a trade fight with China over Beijing's sharp-elbowed efforts to overtake US technological dominance.

China has said it would impose additional tariffs on 659 USA goods, with duties on 545 to kick in on July 6, after Trump said Washington would levy tariffs on $50 billion of Chinese products.

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He told the North Korean leader that he hopes Pyongyang and Washington "will implement well the outcomes achieved at the summit". The U.S. official said: "The United States will continue to monitor this site closely as we move forward in our negotiations".

The United States has imposed tariffs on Canada, Mexico and £25bn in Chinese goods.

"The rules of worldwide trade that we have developed over the years with our American partners can not be violated without a reaction from our side", Malmstrom said.

John Murphy, a senior vice president at the U.S. Chamber of Commerce, estimates that $75 billion in U.S. products will be subject to new foreign tariffs by the end of the first week of July.

As painful as the brewing trade war could prove, many have seen it coming.

"Changes in trade policy could cause us to have to question the outlook", Federal Reserve Chairman Jerome Powell said during a panel discussion at a European Central Bank conference in Sintra, Portugal.

Late last month, Trump proceeded to infuriate US allies - from the European Union to Canada and Mexico by imposing tariffs of 25 percent on imported steel and 10 percent on aluminum.

It had previously registered the move with the World Trade Organization (WTO).

Economists and trade analysts worry that there may be no way out of an all-out trade war between the United States and its most vital trading partners.

"The EU has a responsibility to stand up for open global trade".

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