Ire at Trump’s steel tariff plan
PROTESTING PROTECTIONISM Canada, China and the European Union threaten tariffs of their own
WASHINGTON : A day after President Donald Trump took a swing at US trading partners by threatening stiff and sweeping tariffs on steel and aluminium, they hit back. They promised to retaliate against quintessential US goods like Kentucky bourbon, bluejeans and Harley-Davidson motorcycles.
That is likely to turn into a wave of protest aimed US products as other countries, including traditional allies, respond to Trump’s plan to clamp down on imports of metals from overseas.
Canada, China and the European Union have said they would respond with tariffs of their own that could lead to billions of dollars in US export losses. Those levies would harm the farmers and business interests the Trump administration has promised to protect and would fuel a trade fight that could undermine the president’s goal of strengthening American industry.
Li Xinchuang, vice chairman of the China Iron and Steel Association, called the president’s move “stupid,” saying, “Trump’s decision does no good to everyone except a few American steel enterprises.” And John M. Weekes, Canada’s negotiator for the North American Free Trade Agreement in the early 1990s, said the president’s “notion is going down very badly in Canada.”
“It certainly will have a negative effect on our bilateral relationship,” he said.
US businesses are more tied to the global economy than ever before, and the Trump administration is seeking concessions from trading partners to put US companies on a more competitive footing. Negotiators from Canada, Mexico and the United States were meeting in Mexico City to hash out changes to NAFTA, and Washington is trying to revise a trade deal with South Korea. The possibility of tariffs complicates both efforts.
On Friday, Trump appeared unmoved by the blowback, posting a series of Twitter messages Friday defending his proposal to impose tariffs of 25% on steel and 10% on aluminium. “We must protect our country and our workers. Our steel industry is in bad shape. IF YOU DON’T HAVE STEEL, YOU DON’T HAVE A COUNTRY!” Trump tweeted.
The European Union detailed a three-step plan to penalise $3.5 billion of US trade — the same amount of European steel and aluminum the bloc estimates would be harmed by the planned tariffs. It proposed taxing US exports including bourbon, bluejeans, orange juice, cranberries, rice and motorcycles. The European Union could then take action to protect their own metal makers from a surge in imports, and bring a case against the United States at the World Trade Organization.
A European Union official said that the bloc had been preparing for the announcement for months and that everything was in place for a swift, proportionate response.
The measures were intended to put pressure on politically sensitive areas, trade analysts said.