Posts Tagged ‘European Union’

What EU’s record fine will mean for Google

July 18, 2018

US tech company must pay a €4.3bn penalty but also overhaul its Android model

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Android over money

By Rochelle Toplensky in Brussels

The EU has fined Google a record €4.3bn for imposing anti-competitive terms on companies using the Android mobile operating system, the second time Brussels has penalised the US tech company for abusing its market dominance.

Beyond the financial cost, the European Commission’s antitrust decision has significant implications for Google’s business operations as the company must now overhaul one of the most important computing platforms of the smartphone era.

Antitrust decisions come in two parts. First, EU officials must prove the company is dominant in relevant markets — which they did for Google in general search, licensed mobile operating systems and app stores. (Apple, which does not license its iOS operating system and App Store to rivals, was not considered a competitor to Android.)

Then it must be established that the company unlawfully exploited its strength to stymie competition. The commission found that restrictive terms required makers of Android phones to install Google products as a condition of using Play, the Android app store. Other conditions prevented manufacturers from selling phones that use other operating systems, and paid phonemakers to exclusively pre-install Google search. Google denies wrongdoing.

Why is the case important to Google?

Since its launch in 2007, Android has helped Google preserve its pre-eminence as consumers moved from desktop computers to mobile devices. More than half of worldwide internet traffic is now on mobile devices, 80 per cent of which run on Android, providing a showcase for Google services and mobile apps.

Google gives away Android and keeps it updated for free, covering its costs with the revenues made from people using its services. Licences for the official version of Android are conditional on devicemakers following certain rules.

As a result of the EU decision, Google will be expected to revise the terms of service that made this model viable, notably the guaranteed distribution of Google products. Such changes would leave Google with less control, potentially opening up opportunities for rivals.

How has Google responded?

Google rejects the commission’s case on three main grounds. It argues that the refusal of EU investigators to accept that Android competes with Apple’s iOS system misconstrues the market.

The company also says the commission fails to acknowledge how easy it is for users to switch. Even if apps are pre-installed, Google argues that consumers can easily “swipe away” the Google products and download something else.

And it thinks the commission is underestimating the importance of rules for developers and users. App developers rely on a degree of consistency to distribute products. Making Android more open, in other words, could degrade the user experience.

What triggered the investigation?

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Microsoft, Oracle and Nokia were among 14 companies that complained to the EU in April 2013, claiming Google unfairly supported Android and its mobile services by offering cut-price licensing and exclusivity deals. The commission began an investigation, sending formal charges to Google in 2016.

Brussels launched two other investigations into the tech company. The first, concluded last summer, resulted in a €2.4bn fine for illegally favouring its shopping service over rivals. Google has appealed against the decision. The remaining probe relates to how the company prevented websites that use its search bar and ads from also showing competing ads.

What happens next?

Google will pay the fine and has 90 days to decide how to change its Android contracts to remove illegal provisions. The commission will ultimately review whether the company’s solution complies with its ruling.

If the changes fall short, Google’s parent company Alphabet could be liable for further fines of up to 5 per cent of daily revenues, which would be roughly $12m a day. Google is expected to appeal against the decision in court.

It is too early to tell how Android will change in Europe, or beyond. Google might start to charge a licence fee to cover its software costs and device suppliers might be given more freedom to develop their own version of Android. Google could even mimic Apple and keep Android for use only in its own Pixel phones. Any changes are unlikely to be noticed by users for many months.

https://www.ft.com/content/60502464-8a57-11e8-bf9e-8771d5404543

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EU to curb steel imports after Trump tariffs

July 18, 2018

The European Union will launch measures on Thursday designed to prevent a surge of steel imports into the bloc following the U.S. imposition of tariffs on incoming steel and aluminum, the EU’s official journal said.

EU manufacturers of the products ranging from hot and cold rolled sheets, plates, coated steel and tubes include ArcelorMittal, Voestalpine and Tata Steel. (Reuters)

The European Commission has proposed a combination of a quota and a tariff to counter EU concerns that steel products no longer imported into the United States would instead flood European markets.

The measures are the third part of the EU’s response to U.S. tariffs. It has also imposed tariffs on 2.8 billion euros ($3.3 billion) of U.S. imports, including bourbon and motor bikes, and has launched a legal challenge at the World Trade Organization

The quotas for 23 steel product categories have been set at the average of imports over the past three years, with a 25 percent tariff set for volumes exceeding those amounts. These quotas are allocated on a first come first serve basis.

The main exporters of steel to the EU are China, India, Russia, South Korea, Turkey and Ukraine.

The Commission said that the EU steel industry was “in a fragile situation and vulnerable to a further increase in imports”, with U.S. tariffs reducing its capacity to sell there making them even more vulnerable.

“In the absence of provisional safeguard measures, it is likely that the situation will develop into actual serious injury in the foreseeable future,” the EU official journal said.

European Trade Commissioner Cecilia Malmstrom said in a statement that the bloc was faced with no choice given the threat of serious harm to EU steelmakers and workers, but that EU markets would remain open with traditional trade flows.

The Commission will continue its investigation, which was launched on March 26, until the end of the year. The provisional safeguards can be in place for up to 200 days.

Imports of 28 products increased by 62 percent from 2013 to 2017, most noticeably in 2016 and with further rises this year. However, for five products, imports did not increase, leading the Commission to exclude them from its measures.

For 12 steel product categories, imports from countries including China, Russia and Ukraine are already subject to anti-dumping and anti-subsidy duties. The Commission said it would consider suspending or reducing them to avoid the imposition of “double duties”.

EU manufacturers of the products ranging from hot and cold rolled sheets, plates, coated steel and tubes include ArcelorMittal, Voestalpine and Tata Steel.

Reporting by Philip Blenkinsop; editing by Robert-Jan Bartunek and Emelia Sithole-Matarise

Google to Be Fined Record $5 Billion by EU Over Android

July 18, 2018

Google will be fined about 4.3 billion euros ($5 billion) by the European Union over apps for Android mobile devices, setting a record for antitrust penalties, according to a person familiar with the EU decision.

The penalty — the same amount the Netherlands contributes to the EU budget every year — is due to be announced by EU Competition Commissioner Margrethe Vestager at 1 p.m. in Brussels.

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The EU’s decision would bring the running total of Google fines to 6.7 billion euros after last year’s penalty over shopping-search services. It could soon be followed by more fines from a probe into online advertising contracts.

Google has built a massive business of banner and videos ads, thanks largely to its central role on Android devices. Google will account for a third of all global mobile ads in 2018, according to research firm eMarketer, giving the company around $40 billion in sales outside the U.S. Google risks losing that traction if it is forced to surrender its real estate on millions of Android phones.

QuickTake: Why Google Is Again in the EU’s Antitrust Crosshairs

Google Chief Executive Officer Sundar Pichai had a call with EU Competition Commissioner Margrethe Vestager late Tuesday for a so-called state of play meeting, a usual step to alert companies of an impending penalty, according to one of the people, who asked not to be named because the discussion is private. The probe targets Google’s contracts with smartphone manufacturers and telecoms operators.

The European Commission exceeds last year’s then-record 2.4 billion-euro penalty following an investigation into Google’s shopping-search service. Google owner Alphabet Inc. and the commission both declined to comment on the Android fines.

Despite being a record fine, Alphabet generated about the same amount of money every 16 days in 2017, based on the company’s reported annual revenue of $110.9 billion for the year.

Alphabet shares were down 1.2 percent in pre-market trading in New York on Wednesday.

EU Attack on Android Boosts Rivals in the Battle of the Apps

Levies are based on revenue in the market being probed and can’t exceed 10 percent of a company’s global annual revenue. Google raked in around 25 billion euros in digital advertising in Europe in 2017, equity research firm Pivotal Research estimates.

More significant than a blockbuster fine could be an accompanying order freeing up phone manufacturers to choose non-Google apps to install on Android phones. That would yield crucial real estate for app developers given that about 80 percent of smart mobile devices use Android.

EU officials have been investigating Google contracts that require manufacturers of Android phones to take Google’s search and browser apps and other Google services when they want to license the Play app store.

The EU is also targeting Google’s payments to telecoms operators and manufacturers who exclusively install Google search on devices and contracts that prevent handset makers selling phones using other versions of Android.

Google has a market share of more than 90 percent for general Internet search, licensed smart mobile operating systems and app stores for Android software, the EU said in 2016.

— With assistance by Stephanie Bodoni, and Natalia Drozdiak

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Back UK PM May or face national election, Brexit rebels told

July 18, 2018

Pro-European Union rebels were threatened with a general election this summer if they defeated Prime Minister Theresa May’s Brexit plans on customs, a lawmaker said on Wednesday, threatening to widen rifts in the PM’s party.

British Prime Minister Theresa May speaks to representatives during a visit to the Airbus area at the Farnborough Airshow in Farnborough, England, Monday, July 16, 2018.

Photo: Matt Dunham, AP

Conservative whips, who enforce discipline in the party, threatened to call a confidence vote that could bring down the government before a crucial vote on Tuesday on customs, one lawmaker told Reuters. Rebel lawmaker Anna Soubry told BBC radio that the prospect of a national election was also raised.

“It was an appalling spectacle,” Soubry told BBC Radio 4, adding she had told a senior whip to “bring it on”.

“These nonsenses of threatening general elections, and votes of confidence in the prime minister … bring it on, because I shall be the first in the queue to give my vote of full confidence in the prime minister,” Soubry said. “Problem is, I don’t think she’s in charge any more.”

Conservative lawmakers fear an election, and the possible victory of veteran socialist Jeremy Corbyn. Earlier this month, his Labour Party took a lead in the polls.

Labour also says the June 2016 referendum vote to leave the European Union must be respected but has attacked the PM over the splits in her party.

In one of the most tumultuous periods in recent British political history, there have been four major votes in the past four years: the Scottish independence referendum of 2014, the 2015 UK election, the Brexit referendum of 2016 and the snap election called by May last year.

May narrowly avoided a defeat in parliament at the hands of the pro-EU lawmakers from her own party in Tuesday’s vote, helped by four opposition Labour lawmakers who went against their party to support the government. Turmoil over Brexit plans has hit the pound.

Parliament voted 307 to 301 against an amendment to trade legislation that would have required the government to try to negotiate a customs union arrangement with the EU if, by Jan. 21, 2019, it had failed to negotiate a frictionless free trade deal with the bloc.

On Monday, May infuriated Conservative lawmakers who want to keep the closest possible ties with the EU when she decided to accept a number of demands by hardline pro-Brexit MPs from her party.

That came after she had fought hard to get the agreement of cabinet ministers at her Chequers country residence earlier this month for her vision of Brexit. The cabinet deal was then undermined by the resignations of Brexit minister David Davis and Foreign Secretary Boris Johnson.

Reuters

Reporting by Guy Faulconbridge and Alistair Smout; Editing by Catherine Evans

Google braces for huge EU fine over Android

July 18, 2018

Google prepared Wednesday to be hit with huge EU fine for freezing out rivals of its Android mobile phone system in a ruling that could spark new tensions between Brussels and Washington.

EU Competition Commissioner Margrethe Vestager spoke by telephone with Google chief Sundar Pichai on Tuesday night to tell him about the decision in advance, a source close to the matter told AFP.

Vestager is expected to announce that Google abused its dominant position in the market by making tie-ups with phone makers like South Korea’s Samsung and China’s Huawei.

Two European sources told AFP the fine would be “several billion euros” without giving further details. EU rules say Google could be fined up to 10 percent of parent company Alphabet’s annual revenue, which hit $110.9 billion in 2017.

“The fine is based on the length of the infraction, but also on whether antitrust authorities believe there was an intention to commit the offence, and whether they excluded competitors or not,” said another source close to the matter.

The Android pavilion at the Mobile World Congress (MWC) in Barcelona.

The European Commission, the 28-nation EU’s executive arm, refused to comment.

The long-awaited decision comes as fears of a transatlantic trade war mount due to President Donald Trump’s shock decision to impose tariffs on European steel and aluminium exports.

Denmark’s Vestager has targeted a series of Silicon Valley giants in her four years as the 28-nation European Union’s antitrust chief, winning praise in Europe but angering Washington.

The case against Android is the most significant of three complaints by the EU against the search titan, which has already been hit with a record-breaking 2.4-billion-euro fine in a Google shopping case.

Brussels has repeatedly targeted Google over the past decade amid concerns about the Silicon Valley giant’s dominance of internet search across Europe, where it commands about 90 percent of the market.

– ‘Financial incentives’ –

In the Android file, the European Commission has accused Google of requiring mobile manufacturers such as Samsung and Huawei to pre-install its search engine and Google Chrome browser on phones, and to set Google Search as the default, as a condition of licensing some Google apps.

Google Search and Chrome are as a result pre-installed on the “significant majority” of devices sold in the EU, the commission says.

The complaint formally lodged in April also accuses Google of preventing manufacturers from selling smartphones that run on rival operating systems based on the Android open source code.

Google also gave “financial incentives” to manufacturers and mobile network operators if they pre-installed Google Search on their devices, the commission said.

Vestager’s other scalps include Amazon and Apple.

The EU’s biggest ever punishment targeted Apple in 2016 when it ordered the iconic maker of iPhones and iPads to pay Ireland 13 billion euros ($16 billion) in back taxes that it had avoided by a tax deal with Dublin.

The EU has also taken on Facebook over privacy issues after it admitted that millions of users may have had their data hijacked by British consultancy firm Cambridge Analytica, which was working for Trump’s 2016 election campaign.

The Google decision comes just one week before European Commission chief Jean-Claude Juncker is due to travel to the United States for crucial talks with Trump on the tariffs dispute and other issues.

Transatlantic tensions are also high after Trump berated NATO allies over defence spending at a summit last week, over his summit with Russian leader Vladimir Putin, and over the US president’s pull-out from the Iran nuclear agreement and Paris climate deal.

AFP

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China has Plenty of Ideas on How To Win Trade War

July 18, 2018

Private investment and the European Union could be two sources of strength to counter China’s row with the United States, a report says

South China Morning Post

PUBLISHED : Wednesday, 18 July, 2018, 10:16am
UPDATED : Wednesday, 18 July, 2018, 11:42am

China should spur private investment and consumption at home and ally with the European Union and Japan to help win a trade war against the US, a Chinese think tank has said, as Washington and Beijing engage in tit-for-tat tariffs.

In a report on Tuesday, Renmin University’s National Academy of Development and Strategy also said China should increase the dependence of multinationals on the Chinese market “by importing their products to China or enabling their localised production and sales” as another way to counterbalance the unilateralism of US President Donald Trump.

At the same time, China must be “flexible” in its tariff retaliation list and tighten controls over cross-border capital flows, it said.

Many of the suggestions are in line with China’s existing playbook and action taken since Trump escalated the hostilities with threats of another US$200 billion of Chinese goods with a 10 per cent tariff. China and the US had already exchanged 25 per cent tariffs on US$34 billion of each other’s goods.

China has taken the case to the World Trade Organisation for arbitration, but it has not yet announced any specific countermeasures.

“To fight US trade protectionism, [we] should make use of the different interests among countries to deepen economic cooperation with Japan, the EU, the Association of Southeast Asian Nations, Japan and Russia,” the report said.

The report was released a day after the annual China-EU Summit in Beijing, where there were signs of progress on a bilateral investment treaty.

But Renmin University professor Yu Chunhai, who co-authored the report, cautioned that the basis of cooperation between China and the EU cooperation was “not solid as we thought” because there was not much European involvement in the value chain of US-bound Chinese products.

On the home front, the think tank suggested that China boost domestic consumption by freeing up restrictions on private investment in areas like health care, education, tourism and social security.

China should also make the yuan exchange rate “more flexible” – a hint that Beijing might allow a greater yuan appreciation – and improve capital account controls to minimise impacts from “the US dollar and US monetary policy on Chinese monetary, financial and economic situation”.

Mei Xinyu, a researcher affiliated with China’s Ministry of Commerce, agreed with the suggestions, saying China had to improve its economic ties with the EU and Japan and use the trade war as a “pressure test” to spot economic vulnerabilities.

Renmin University vice-president Liu Yuanchun said the country had entered a “real period of difficulty” because the trade war came in the middle of “painful” structural adjustment for the country.

Liu said the row had already put a dent in investor confidence in the Chinese stock market and currency.

“We need to fine-tune our policies to offset a series of shocks, particularly external shocks … The trade war [with the US] is absolutely not based on economic but political logic. It won’t end immediately but to escalate step by step,” he said.

https://www.scmp.com/news/china/economy/article/2155733/what-china-can-do-win-trade-war-beijing-think-tank-offers-its-top

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European Commission President Jean-Claude Juncker at the Great Hall of the People in Beijing, China, Monday, July 16, 2018. (AP File Photo/Ng Han Guan)
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EU’s Jean-Claude Juncker to visit Donald Trump to talk trade on July 25

July 17, 2018

European Commission President Jean-Claude Juncker will visit US President Donald Trump in Washington on July 25 to discuss strained trade ties between the two.

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European Commission President Jean-Claude Juncker at the Great Hall of the People in Beijing, China, Monday, July 16, 2018. (AP File Photo/Ng Han Guan)

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“President Juncker and President Trump will focus on improving transatlantic trade and forging a stronger economic partnership,” the Commission said in a statement on Tuesday that announced the date.

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Trade tensions rose after the United States imposed import tariffs on EU steel and aluminum at the start of June and have increased with Trump’s threat that those tariffs could extend to EU cars.

Reuters

http://www.arabnews.com/node/1340636/world

The Trump First Doctrine

July 17, 2018

Putin respects strength but Trump showed weakness.

President Donald Trump and Russian President Vladimir Putin give a joint news conference following their meeting at the Presidential Palace in Helsinki, Finland, July 16.
President Donald Trump and Russian President Vladimir Putin give a joint news conference following their meeting at the Presidential Palace in Helsinki, Finland, July 16. PHOTO: © SHARIFULIN VALERY/TASS VIA ZUMA PRESS

Donald Trump left for Europe a week ago with his reputation enhanced by a strong Supreme Court nomination. He returned Monday with that reputation diminished after a tumultuous week of indulging what amounts to the Trump First Doctrine.

Mr. Trump marched through Europe with more swagger than strategy. His diplomacy is personal, rooted in instinct and impulse, and he treats other leaders above all on how much they praise Donald J. Trump. He says what pops into his head to shock but then disavows it if there’s a backlash. He criticizes institutions and policies to grab headlines but then claims victory no matter the outcome.

The world hasn’t seen a U.S. President like this in modern times, and as ever in Trump World everyone else will have to adapt. Let’s navigate between the critics who predict the end of world order and the cheerleaders who see only genius, and try to offer a realistic assessment of the fallout from a troubling week.

• NATO. The result here seems better than many feared. Mr. Trump bullied the allies with rhetoric and insulted Germany by claiming it is “totally controlled” by Russia. But his charges about inadequate military spending and Russia’s gas pipeline had the advantage of being true, as most leaders acknowledged.

The 23-page communique that Mr. Trump endorsed is a solid document that improves NATO’s capabilities to deter and resist a threat from Russia. Mr. Trump’s last-minute demand that countries raise military spending to 4% of GDP was weird, but he is right that more countries are likely to meet the 2% target.

One risk is that Mr. Trump’s constant criticism of NATO will undermine public support for it in the U.S.—and, more dangerously, undermine the alliance’s deterrence against Russia. If Vladimir Putin concludes Mr. Trump isn’t willing to protect the Baltic states, he may pull another Crimea.

• The Brits. Mr. Trump turned a friendly visit into a fiasco by criticizing Prime Minister Theresa May’s Brexit strategy in an interview with the Sun newspaper. He backtracked a day later, calling his own comments on tape “fake news,” and Mrs. May was gracious.

But Mr. Trump should encourage a U.S.-British post-Brexit trade deal both in the U.S. interest and to help Britain negotiate the most favorable Brexit terms from the European Union. Other leaders will conclude from his rude treatment of Mrs. May that working with Mr. Trump is more perilous than fighting him.

• The EU. In contrast to NATO, Mr. Trump does seem to want to undermine the European compact. He called it a “foe” on trade, which will make negotiating a better trade deal even less likely. He seems determined to impose a 20% or higher tariff on European autos to strike at Germany, which would also hit France and others.

The U.S. isn’t part of the EU, but American Presidents have found it useful as an ally to leverage sanctions against, say, Russia or Iran. Mr. Trump is stoking European resentments that will bite back sooner or later when he wants Europe’s help.

• Russia. Details from the private Trump-Putin talks in Helsinki will spill out in coming days, but Monday’s joint press conference was a personal and national embarrassment. On stage with the dictator whose election meddling has done so much harm to his Presidency, Mr. Trump couldn’t even bring himself to say he believed his own intelligence advisers like Dan Coats over the Russian strongman.

“I have—I have confidence in both parties,” Mr. Trump said. “So I have great confidence in my intelligence people, but I will tell you that President Putin was extremely strong and powerful in his denial today.” Denials from liars usually are strong and powerful.

The charitable explanation for this kowtow to the Kremlin is that Mr. Trump can’t get past his fury that critics claim his election was tainted by Russian interference. And so he couldn’t resist, in front of the world, going off on a solipsistic ramble about “ Hillary Clinton’s emails” and Democratic “servers.” He can’t seem to figure out that the more he indulges his ego in this fashion, and the more he seems to indulge Mr. Putin, the more ammunition he gives to his opponents.

For a rare moment in his Presidency, Mr. Trump also projected weakness. He was the one on stage beseeching Mr. Putin for a better relationship, while the Russian played it cool and matter of fact. Mr. Trump touted their personal rapport, saying the bilateral “relationship has never been worse than it is now. However, that changed as of about four hours ago. I really believe that.” In four hours?

Mr. Putin focused on his agenda of consolidating Russian strategic gains in Syria, Ukraine and arms control, and suggesting that the American might help. Mr. Trump even seemed to soften his stance against Russia’s Nord Stream 2 gas pipeline to Germany.

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By going soft on Mr. Putin, Mr. Trump will paradoxically find it even harder to make deals with the Russian. Republicans and Democrats will unite in Congress, as they should, to limit his diplomatic running room. Mr. Trump may decide to court Mr. Putin anyway, like Barack Obama did Iran’s mullahs, but political isolation concerning a foreign adversary is a weak and dangerous place to be.

Appeared in the July 17, 2018, print edition.

https://www.wsj.com/articles/the-trump-first-doctrine-1531781061

China’s Cooling Economy Spells Trouble Ahead for Global Growth

July 16, 2018

Confirmation that China’s economy is slowing amid an escalating trade war is a worrying omen for global growth.

Data released since Friday has affirmed what’s been expected for some time: That an ongoing campaign to curtail credit is putting the brakes on the world’s second-largest economy. Given that China generates as much as a third of global growth, that’s adding to signs that the best world expansion in years is plateauing.

The International Monetary Fund, which has repeatedly warned that the trade spat between the U.S. and China will reverberate globally, is scheduled to release fresh growth forecasts later Monday. The Chinese economy grew at an expected 6.7 percent in the second quarter, its slowest pace since 2016, while key readings on investment growth and industrial output slowed in June. Retail sales held up.

Read more on the latest data on China’s economy

While the numbers point to a modest slowdown in China, the U.S.-led trade war has only just begun. U.S. President Donald Trump this month implemented tariffs on an initial $34 billion of imports from China, which retaliated in kind. Trump is expected to deliver levies on another $16 billion worth of goods and has threatened to expand the hit-list by $200 billion. China has threatened to retaliate again.

That means headwinds not just for China’s economy, but for the world’s too.

“If the U.S. and China do not resume talks in the next two months or so, the conflict will escalate further, with major economic implications for themselves and the global economy,” Louis Kuijs, head of Asia Economics at Oxford Economics in Hong Kong, wrote in a note after the data’s release.

The global tensions were clear to see at a summit between leaders of the European Union and China in Beijing. E.U. President Donald Tusk warned that trade wars can lead to “hot conflicts” while summit host, China’s Premier Li Keqiang, said nobody will win from the dispute.

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It’s the spillover effect that most worries economists, given China’s central role in a regional and global supply chain that feeds America’s economy with goods and services.

“We have not seen the worst yet,” said Iris Pang, Greater China economist at ING Bank NV in Hong Kong. “For the rest of the world it begins with a bilateral trade war between the U.S. and China but it would not end with a bilateral impact. Global supply chains, shipping companies, foreign investment hurdles from the U.S. government at the same time as China pledges to welcome more foreign investment will change global business flows.”

China’s Trade Surplus With the U.S. Just Keeps on Growing

If the U.S. goes ahead with tariffs on $250 billion worth of imports, the hit to China’s growth could mean a drag of 0.3 percentage point, according to Morgan Stanley. There’s also the risk of an indirect hit to China arising from supply chain complexities which could subtract another 0.3 percentage point from growth. Bloomberg Economics estimates that the tariffs would shave 0.5 percentage point off GDP growth.

“Not small, but still manageable in the context of an economy heading toward a government growth target of 6.5 percent for this year,” Fielding Chen and Qian Wan wrote.

Image result for china trade, photos

To be sure, China has the means to respond given the massive fiscal and monetary firepower available to policy makers. Economists at Australia and Banking Group Ltd. expect the government to unleash fresh spending while JPMorgan Chase & Co. expects the People’s Bank of China to cut the reserve ratio requirement by 50 basis points over the next year, among other measures.

Already, spending by China’s government jumped in June, underscoring efforts to stabilize growth.

They may need to deploy more of that firepower.

“The trade wars are going to get worse,” said Michael Every, head of financial markets research at Rabobank Group in Hong Kong. “It’s bad news for China, and for all of us.”

— With assistance by Yinan Zhao, Xiaoqing Pi, and Miao Han

https://www.bloomberg.com/news/articles/2018-07-16/china-s-cooling-economy-spells-trouble-ahead-for-global-growth

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Germany: We can no longer fully rely on U.S. White House

July 16, 2018

Germany’s foreign minister said on Monday Europe could not rely on Donald Trump and needed to close ranks after the U.S. president called the European Union a “foe” with regard to trade.

Image result for Heiko Maas, photos

German Foreign Minister Heiko Maas 

“We can no longer completely rely on the White House,” Heiko Maas told the Funke newspaper group. “To maintain our partnership with the USA we must readjust it. The first clear consequence can only be that we need to align ourselves even more closely in Europe.”

He added: “Europe must not let itself be divided however sharp the verbal attacks and absurd the tweets may be.”

Reporting by Michelle Martin; Editing by Robin Pomeroy