Trump’s trade war is ‘wake-up call’ for Europe

European Central Bank, ECB, President, Christine Lagarde, on Friday said a full-scale global trade war would hurt the United States in particular and could re-energise Europe’s push towards unity.

Recall that the U.S. has imposed a raft of tariffs on allies and adversaries alike and threatened even more measures, prompting retaliation from many and raising concerns that global growth could take a major hit.

“If we were to go to a real trade war, where trade would be dampened significantly, that would have severe consequences. It would have severe consequences for growth around the world and for prices around the world, but particularly in the United States,” Lagarde said.

The European Central Bank reiterated, however, that the tensions could also have the positive side effect of giving European unity another push.

“You know what it’s doing at the moment? Stirring European energy. It’s a big wake-up call for Europe. Maybe this is a European moment, yet again,” she said.

It was gathered that the European Commission and Germany, the bloc’s largest economy, have already announced increased spending on defense and infrastructure, ending years of reluctance to spend.