Taiwan's Foxconn calls Sino-US trade spat a 'tech war'

Nick Johnson harvests cranberries in a bog at Gilmore Cranberry Company in Carver Massachusetts

Nick Johnson harvests cranberries in a bog at Gilmore Cranberry Company in Carver Massachusetts

The EU's retaliatory tariffs against the U.S. came into force this morning, affecting products such as bourbon whiskey, jeans, motorbikes and orange juice.

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

The EU's reactive charges on €2.8bn (£2.4bn) worth of USA goods came into force on Friday morning, with European Commission president Jean-Claude Juncker slamming the White House for acting against "all logic and history".

While most economists believe a tariff war between the world's two largest economies will not derail global growth even if U.S. President Donald Trump follows through with duties on $450 billion of imports from China, individual industries such as agriculture, autos and technology look set to be hit hard.

A trade war is brewing between the world superpowers, United States of America and China and this could have dire economic consequences, not just for the two countries but globally too.

President Trump said the measures against the EU are meant to protect USA national security interests, but the Europeans claim it can not be that close allies, many of them North Atlantic Treaty Organisation partners, would endanger US security.

Foxconn, the world's largest electronics contract manufacturer, on Friday said the US and Chinese governments are engaged in a technology war, not a trade war, describing the spat as the biggest challenge the Taiwanese company is facing.

Mexico has already announced its own tariffs on USA goods, and Canada's tariffs on almost $13 billion of United States products are set to take effect next month.

The equivalent value of €2.8 billion worth of USA goods that will be hit by import duties charged by the EU.

Mexico placed tariffs on American products ranging from steel to pork to bourbon two weeks ago.

"We've never seen anything like this", said Mary Lovely, a Syracuse University economist who studies worldwide trade - at least not since countries tried to wall themselves off from foreign competition during the Great Depression.

Items such as cars have seen pledges of cuts and in May, Beijing said it would lower import tariffs on 1,449 consumer goods, starting from July 1. Beijing has vowed to immediately retaliate with its own tariffs on USA soybeans and other farm products in a direct shot at President Donald Trump's supporters in America's heartland.

In trade wars, there tend to many casualties and few winners.

Trump ran for the presidency on a vow to topple seven decades of American policy that had favored ever-freer trade among nations.

Economists note that on the whole, the US and European Union tariffs will not immediately cause great damage to either side's economy.

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

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