EU targets Harley Davidson, Levi's in Trump trade war

Harley Davidson could be among the US brands to face EU retaliatory measures if US President Donald Trump goes ahead with tariffs on steel and aluminium. (Photo: AFP/Patrik Stollarz)

But a top EU trade official said Trump still has a small chance to avoid a damaging global trade war and asked the US leader to reconsider his aims before he signed them into effect next week.

"We will not sit idly when European industry and jobs are threatened," European Commission chief Jean-Claude Juncker said on the sidelines of a conference in Hamburg, Germany.

"The EU is preparing import duties for US products including Harley-Davidson, Bourbon and Levi's jeans," his spokeswoman quoted him as saying on Twitter.

The threat appeared to fall on deaf ears as Trump on Friday welcomed the prospect of a trade war, remaining defiant in the face of the global uproar sparked by his raft of fresh tariffs.

With global stock markets tumbling and allies riled, the president greeted the negative reaction by raising the stakes and vowing even more sweeping trade attacks in a series of angry tweets.

Despite Trump's reaction, European Commission vice president Jyrki Katainen told AFP "there is a little window of opportunity still open" and that Europe was not a danger to the US.

"That means that the president of the US has not yet signed the proposals. So we do hope that he will reconsider his aims," the former Finnish prime minister said.

"We are very close to a fast spreading trade war and in this kind of war there are only victims, not winners," Katainen said.

'MEDICINE NOT RIGHT'

Katainen, who handles trade policy for the EU with trade commissioner Cecilia Malmstrom, said he understood that the US was seeking to take a stand against China, which has flooded the globe with cheap steel.

"I understand the frustration but the medicine the US administration is willing to use is not right," he said.

A "global trade war ... means in concrete terms unemployment, less economic growth, and worse relations between trading partners," he said.

"At a time when we have just come out of the most severe economic crisis in decades, nobody should do anything in order to harm the stability we have achieved," he added.

The EU would "form a coalition of like-minded countries and potentially take the US to the WTO court together," Katainen said in reference to the World Trade Organization tribunal in Geneva.

These countries could include Japan, Canada, Turkey and Mexico, he said.

The EU's targeting of bourbon whiskey and motorcycles had been expected and matches similar moves in 2003 during a "steel war" unleashed by the administration of George W. Bush.

At the time, the list included not just steel products but also orange juice, apples, sunglasses, photocopiers and other goods.

The United States backed down before the EU carried out its threat to impose the retaliatory measures.