German auto giant Volkswagen said Friday that tariffs imposed by US President Donald Trump had cost it 1.3 billion euros in the first half of the year as it reported falling profit.

An escalatory spiral that leads towards Eurasia's 10% 'trade war' scenario, however, would prompt Brussels to deploy escalatory measures, such as "export controls/duties, public procurement curbs, and/or penalties on U.S. services exports" by using the ACI "trade bazooka as a last resort," they concluded.

This week, top European Union leaders are traveling to Beijing for a high-level summit which could set the tone for the relationship between the EU and China for years to come.On today’s Big Take Asia Podcast,