Trump’s Likely Pick for EU Envoy Calls for More Referendum Votesby and
Ted Malloch: EU is ‘overly complex, fairly bloated’ grouping
Accuses Germany of currency manipulation, hitting U.S.
Donald Trump’s war of words with the European Union escalated as the man tipped to become his envoy to the bloc accused Germany of currency manipulation and called on other countries to follow the U.K.’s Brexit vote with their own referendums.
Germany has “tilted the tables” to its own advantage by manipulating the euro, hurting southern European countries and undercutting businesses in America, according to Ted Malloch, who confirmed he’s been interviewed for the role of U.S. ambassador to the EU.
“It is grossly to the disadvantage of the United States because it leads to cheap exports coming from Germany and flooding even the U.S. market,” Malloch said in an interview with Bloomberg Television Friday. “I would personally like to see more countries have referenda where the actual citizens of those countries make democratic decisions about their own sentiments towards a European Union of one sort or another.”
Malloch’s comments will add to growing tensions between the EU and the new Trump administration after the president suggested the 28-country bloc could unravel in the years ahead. Malloch, a professor at the U.K.’s Henley Business School, has already alarmed European politicians after likening his prospective role in Brussels to bringing down the Soviet Union.
Bloated and Complex
In an unprecedented move, the European Parliament’s main political parties have written to the EU’s leaders demanding that they reject Malloch’s appointment, The Guardian newspaper reported on Thursday.
Malloch dismissed the letter and the criticism of his views as he renewed his attack on the state of the EU. “It is an overly complex fairly bloated bureaucratic organization,” he said in the interview. “Its ambitions have basically overstepped its capabilities, so the question really is what the European member states want to see for that European union.”
Malloch said elections in France and Germany this year mean “the whole question of European integration, the future of the euro, the future of the European Union is very much on the ballot.”
Turning to the euro, he said some hedge funds are betting on the 19-member common currency coming apart and accused Germany of unduly benefiting from its current level.
“It looks to me like at least on one, if not two of the categories of currency manipulation, Germany has tilted the tables towards itself to the disadvantage, frankly, of southern Europe,” he said. “It is grossly to the disadvantage of the United States because it leads to cheap exports coming from Germany and flooding even the U.S. market.”
The remarks echo Trump’s trade adviser Peter Navarro, who told the Financial Times that Germany’s excessive trade surplus is a sign of a “grossly undervalued” currency. Chancellor Angela Merkel later pushed back, saying the exchange rate was the province of the European Central Bank and that the German government has long upheld the ECB’s independence.
While Navarro pushed the shared currency higher against the dollar on Monday, there was no similar reaction to Malloch’s comments. The euro remains the most undervalued among its Group-of-10 peers, according to an OECD measure of purchasing-power parity that puts it 24 percent below fair value.