US risks 'losses' too in any trade war it starts, French minister says

The US should brace itself for "losses" that would result from any new trade wars it starts , France's Foreign Trade Minister told The National, making clear that Europe will stand united to respond to protectionist regimes. While France values its relationship with America – one of its first and oldest allies – Europe's third largest economy is not interested in engaging in tit-for-tat tariffs, Laurent Saint-Martin told The National during a visit to Abu Dhabi. "We have to keep [our relationship with the US] because it's precious [not only] in terms of investment and trade, but also in terms of history and value," he said. "But at the same time, If the US wants to keep on going this way with tariffs and other protectionist measures … we have to adapt. If in Europe, we have exports that can be taxed more in the US market, we have to respond and think about retaliation measures. Europe has to show the world [it is united]." The US, under the second administration of Donald Trump, has ramped up tariffs against its biggest trade partners and allies, continuing the America First stance he championed in his first term that sought to strengthen the world's largest economy, protect its industries and create more jobs. In February, the president announced plans to impose 25 per cent tariffs on all US steel and aluminium imports beginning March 12, with no country exemptions and product exclusions, with the possibility of more downstream products to be included. The first countries that were hit under Trump 2.0 were its biggest trade partners, Canada and Mexico, and economic rival China. Mr Trump, however, agreed to pause the implementation of the tariffs on its two neighbours. China immediately responded with retaliatory tariffs. And just this week, Mr Trump threatened to slap similar 25 per cent levies on cars, chips and pharmaceuticals, which would be in effect as soon as April 2. He has also asked the US Trade Representative to revisit the possibility of imposing retaliatory digital tariffs on countries that tax US companies. Mr Trump has also threatened Europe with tariffs. The European Commissioner for Trade and Economic Security, Maros Sefcovic, met Trump representatives on Thursday in a bid to soothe tensions. The EU itself is embroiled in a tariff spat with China , after it slapped levies on Chinese-made electric vehicles last year. Beijing has challenged these at the EU's Court of Justice. In any case, tariffs "could upend traditional trading relations, creating significant uncertainty in the global economy", the World Economic Forum said this week. Countries that impose tariffs are "going the wrong way" because "creating a trade war won't benefit anyone; it will be losses for everyone, the US included", Mr Saint-Martin said. "It's not in our interest. It's not in the US' interest," he added. Meanwhile, France is eager to further boost its co-operation with the UAE, particularly in several technology fields, following a major artificial intelligence partnership between the two countries, Mr Saint-Martin said. The UAE will be investing between €30 billion and €50 billion ($8.2 billion and $13.6 billion) to build a 1 gigawatt data centre in France, which is being tipped to be Europe's largest, Paris said earlier this month. The announcement was made during the visit of President Sheikh Mohamed to the French capital , where he met French President Emmanuel Macron . When it comes to AI, "we are talking about a revolution that will have consequences in society, economic relationships and geopolitics", Mr Saint-Martin said, adding that France is seeking to be at the forefront of technology and "lead many other fields". The UAE's investments will be important for enhancing France's value chain, which already boasts technology talent, more than 1,000 start-ups and recognised learning institutions, in addition to sustainable sources of energy, all of which are key to building a well-rounded technology ecosystem. "In AI, France has to be with the other EU members and we need to diversify our partnerships; we need to have partners that we believe in and that truly believe that AI can be the revolution … and the UAE is one of them," the minister said. Mr Saint-Martin said France is open to the idea of creating a global body to regulate technologies like AI, but this has to start within Europe first. "First of all, we have to think on a European scale. France has always been in favour of multilateralism and it won't stop because we do believe in global progress," he said. In addition to the UAE, GCC countries are "always welcome" to explore investment opportunities with France, Mr Saint-Martin said. Non-oil trade between the UAE and France jumped by more than 21.3 per cent year-on-year to about Dh44 billion ($12 billion) in 2024, according to a statement from French energy major TotalEnergies on February 17. The statement was released during the visit of Dr Sultan Al Jaber, Cop28 President and Minister of Industry and Advanced Technology, to Paris, where he also met Mr Saint-Martin. "The region is very strong and has huge potential and we are all the time talking about investments in France. But don't forget, that we also want to invest here [in the UAE and GCC]," Mr Saint-Martin said.

US risks 'losses' too in any trade war it starts, French minister says

Interview: Europe will stand united to respond to protectionist regimes, says Foreign Trade Minister Laurent Saint-Martin