Trump's proposed "border tax" could also hit U.S. economy hard: Finnish minister

The consequences of the U.S. president proposed "border tax" would not only be harmful for the world economy, but also hit the U.S. economy itself, Finnish Minister of Foreign Trade and Development Kai Mykkanen said on Thursday.

Last month, U.S. President Donald Trump pressured Ford, General Motors, Toyota and other companies to bring factories back to the United States, threatening to impose a "big border tax" on them if they shift production to Mexico.

"Make in U.S.A. or pay big border tax," Trump wrote in a tweet last month.

Mykkanen told Lannen Media, a joint national newsroom of Finnish regional media, that the proposed "border tax" would be a major obstacle for the Finnish forest industry to export goods to North America.

He added that consequences of the proposal would have a strong impact on the vitality of the Finnish production, as Finland strongly depends on the U.S. market.

The Finnish economy would always be affected if something happens in the forest industry, which is the Nordic country's pillar industry, noted Mykkanen.

He also stressed that the economic shock in Europe would damage the U.S. economy itself.

Mykkanen said anything that prevents U.S. companies from using global products or best international expertise would hit the U.S. economy hard too.

"Free movement of people and goods has been a cornerstone of the strong position of the U.S.," he emphasized.

Currently, the EU and Japan are in the final stages of negotiations on a free trade agreement. Mykkanen suggested that the EU should process the free trade agreements further with China and India.

He claimed that the Trump administration and the EU would have a confrontation in the World Trade Organization (WTO), if Trump undertakes the political threat of border tax, which would be contrary to the rules of WTO.

The consequences of the "border tax" for the global economy would be difficult to predict, warned Mykkanen. Endit