US trade war ‘will spark deep recession’

DONALD Trump’s threatened tariffs on imported steel and aluminium could lead to a ‘deep recession’, the World Trade Organisation warned yesterday.

WTO director general Roberto Azevedo said: ‘An eye for an eye will leave us all blind, and the world in deep recession.’

he said members of his organisation ‘must make every effort to avoid the fall of the first dominoes’. Mr Trump rocked global markets and drew threats of retaliation, even from allies such as Canada and the eU, after he said he wanted to impose a 25 per cent tariff on steel imports and a 10 per cent tax on aluminium.

Mr Azevedo’s warning was echoed by French president emanuel Macron, who said yesterday the planned tariffs amounted to ‘economic nationalism’ and that all sides would lose.

he called on the eU to react ‘swiftly and proportionately’ within the WTO.

The WTO requires that members treat all other members equally when it comes to trade, but the White house says the tariffs would apply to all countries with no exemptions. Theresa May’s spokesman yesterday said Britain remained confident it can reach a post-Brexit trade deal with the US.

Mr Trump hopes the tariffs will protect domestic steel and aluminium industries, while also reducing America’s $ 800 billion (£ 578 billion) annual trade deficit.

his trade adviser Peter Navarro shot down rumours that Mr Trump would exempt American allies, saying: ‘There will be no country exclusions.’