Germany believes that if US President Donald Trump’s decision to impose tariffs grows into a full-scale trade war, it will cause a tangible damage to the global economic recovery, Reuters reported.

“The German economic upswing is continuing at the beginning of 2018. The global economic environment is still favorable,” the Economy Ministry said in a statement.

According to the source, tariffs for steel and aluminum imports will affect trade flows in some regions, but their overall effect on the global economy is likely to be manageable.

“But a possible escalation into a trade war and rising uncertainty among market participants could cause tangible damage,” the statement said.

According to German new economy minister, Peter Altmaier, US President Donald Trump challenges multilateral trading system.

The threat of a full-scale trade war will also be on the agenda of the G20 meeting in Argentina, where finance ministers and central bank governors from 20 major countries will meet on March 17-20.