EU Trade War With US Heats Up

European Union tariffs have come into effect on a range of iconic US products - including bourbon, jeans and motorcycles - in its opening salvo in a trade war with President Donald Trump.

The tariffs - which took effect at 6am Friday Hong Kong time - will further fuel jitters in world stock markets, that are already alarmed by worsening trade tensions between the US and China.

Customs agents across the Europe's market of 500 million people will now impose the duty, raising prices on US-made products in supermarkets and across factory floors.

Brussels imposed the duties on products worth US$3.3 billion in a tit-for-tat response to Trump's decision to slap stiff tariffs on European steel and aluminium exports.

EU Trade Commissioner Cecilia Malmstrom said this week that the 28-nation bloc was left with no other choice but to impose tariffs of its own after the "unilateral and unjustified decision of the US".

Together with US tariffs against Mexico and Canada, the battles have raised the spectre of a global trade war, spooking financial markets that fear major consequences to the global economy.

"We have a trade war - and it's an escalating trade war," SEB chief economist Robert Bergqvist said.

Brussels first drew up the list in March when Trump initially floated the 25 percent tariffs on steel imports and 10 percent on aluminium, which also target Canada, Mexico and other close allies.

The list does not specifically name brands but European Commission chief Jean-Claude Juncker spelled out in March that the bloc would target Harley-Davidson, bourbon and Levi's jeans. (AFP)