BIARRITZ: US
President Donald Trump and EU leaders exchanged trade war threats yesterday as
they arrived in France for a G7 summit of wealthy democracies overshadowed by
trans-Atlantic tensions before it had even begun. "Trade wars will lead to
recession, while trade deals will boost the economy," EU Council President
Donald Tusk said in Biarritz, the chic Atlantic resort chosen by French host
President Emmanuel Macron to stage the annual meeting.

Trump flew into
Biarritz on Air Force One hours after promising to impose punishing tariffs on
French wine imports if Macron doesn't withdraw a tax on US tech giants. And
Tusk vowed that the EU "will respond in kind." "The last thing
we need is a confrontation with our best ally, the United States," he
said. "This is not our initiative, this trade and tariff struggle, but we
have to be ready and we are ready."

It was a
combative opening to the G7 summit, traditionally a forum for frank yet cordial
discussions among leaders from the world's leading economies-but much less so
since Trump's election. European leaders are also using the summit to mount a
tough push for action against fires in the Amazon rainforest, despite Brazilian
right wing President Jair Bolsonaro's angry response to what he sees as outside
interference. Echoing a warning from France, Tusk said Bolsonaro's response to
the fires and his downplaying of climate change threw into question a major
EU-South America trade deal.

"We of
course stand by the EU-Mercosur agreement, which is also about protecting the
climate and the environment," he said. "But it is hard to imagine a
harmonious process of ratification by the European countries as long as the
Brazilian government allows for the destruction of the green lungs of planet
Earth."

'People are
mobilized'

G7 leaders were
greeted by a mass protest outside Biarritz, though 13,000 police have been
deployed to keep them far from view. Organizers said 15,000 people rallied
around 30 kilometers (20 miles) south of the G7 gathering at the border town of
Hendaye for a march over the Bidassoa River toward the Spanish town of Irun.

Red, white and
green Basque flags waved above a crowd that included anti-capitalists,
environmental activists as well as a few dozen of France's "yellow
vest" anti-government protesters, according to AFP journalists at the
scene. "It's important to show that people are mobilized and do not accept
the world they're offering us," said Elise Dilet, 47, of the Basque
anti-globalization group, Bizi. The rally was peaceful so far, after police
said 17 people had been arrested as of Friday night amid clashes with
protesters camped out near Hendaye.

Escalating
threats

Talks in the
beach resort, known for fierce rainstorms that blow in from the Atlantic, will
also be dominated by the darkening clouds over the world economy.

Wall Street
stocks slumped Friday after Trump escalated his trade war with China that is
seen as responsible for a global slowdown. "We don't need China and, frankly,
would be far... better off without them," Trump tweeted on Friday, saying
US companies were "hereby ordered to immediately start looking for an
alternative to China."

And as he left
for Biarritz, Trump also fired a salvo at France, threatening to slap heavy
tariffs on its wine in response to its move to impose a sales tax on tech
giants like Facebook, Apple and Google. "Those are great American
companies, and frankly, I don't want France going out and taxing our companies.
Very unfair," he told reporters at the White House. "And if they do
that, we'll be taxing their wine... like they've never seen before." In a
televised address ahead of the summit, Macron said his goal was "to
convince all our partners that trade tensions are bad for everyone".

Johnson debut

The G7 meeting
will also be the full international debut of British Prime Minister Boris
Johnson, who will meet Trump for the first time as leader. They are expected to
discuss the UK's impending exit from the European Union, which the US president
has enthusiastically backed. But though Johnson needs Trump's support for a
free-trade deal, he is at odds with him on a range of issues including the Iran
nuclear crisis, climate change and global trade.

Trump is likely
to find himself under pressure from the Europeans, particularly Macron, to ease
off on his policy of "maximum pressure" on Iran over its nuclear
program. Since pulling out of the landmark 2015 nuclear agreement limiting
Tehran's nuclear program, Trump has slapped crippling sanctions on the Iranian
economy. Macron wants him to put a "pause" on the policy, an aide
said recently, which would enable talks to find a new diplomatic solution to
the crisis. Iranian Foreign Minister Mohammad Javad Zarif told AFP on Friday that
Macron's "suggestions" to find a way out of the current impasse were
"moving in the right direction." -AFP