By Giulia Segreti
ROME (Reuters) -The only acceptable tariff on European Union exports to the United States would be zero as the bloc is already facing a detrimental exchange rate, the head of Italy’s business lobby said on Wednesday.
“The real issue is that, to date, not only do we have to consider the burden of tariffs, but we must add to that the euro’s appreciation against the dollar,” said Confindustria President Emanuele Orsini.
The euro has risen by more than 12% against the dollar since the start of the year.
Orsini said the dollar’s devaluation against the euro “is the biggest in the world” and that Confindustria’s projections indicate that it would increase in the coming months, to reach up to 20%.
“Any tariff level on top of that is out of control,” since the cheaper dollar represents the “highest tariff that (Europe) already faces… making us lame from the start”, Orsini said at a conference in Rome.
U.S. President Donald Trump on Saturday threatened to impose a 30% tariff on imports from Mexico and the European Union starting on August 1, a level European officials say is unacceptable and would end normal trade between two of the world’s largest markets.
According to Confindustria, each percentage point of tariffs imposed by the U.S. would translate into a loss of Italian exports worth 874 million euros ($1 billion). The association did not specify over what amount of time.
With 30% tariffs, Italy would lose 37.5 billion euros in exports, Orsini said, factoring in the exchange rate impact.
Earlier this month he had already warned that tariffs of 10% would have been unsustainable for the Italian economy.
Orsini added that Trump’s final goal was to “relocate Europe’s major companies to the United States” and called on the European Union to set out a plan to hold on to its businesses.
($1 = 0.8608 euros)
(Reporting by Giulia Segreti, editing by Cristina Carlevaro and Alvise Armellini)
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