By Paul Hannon
Higher barriers to trade would have a negative impact on the global economy, and Europe must be prepared for increased tensions, Bank of Finland Governor Olli Rehn said Tuesday.
Rehn, who is a member of the European Central Bank's governing council, said a soft landing for the eurozone economy was still a "plausible" scenario, but the outlook is clouded by growing geopolitical uncertainty.
A new element in that uncertainty is the trade policy of Donald Trump in his second term as U.S. president. Trump has expressed a desire to raise tariffs on imports from a wide range of countries.
"What we do know is that significant import duties could have negative ramifications for the global economy," said Rehn.
Rehn said Europe must be better positioned to respond than during Trump's first term.
"If a trade war were to start, Europe must not be unprepared," he said.
Write to Paul Hannon at paul.hannon@wsj.com
(END) Dow Jones Newswires
11-12-24 0454ET
