G20 sees 3-way steel bat­tle be­tween EU, US and China

Kuwait Times - - INTERNATIONAL -

While bat­tles be­tween po­lice and protestors smoul­der out­side, lead­ers of the Euro­pean Union, United States and China ap­pear close to a trade war cliff edge at the G20 sum­mit in Hamburg. “We are al­ready hear­ing that some par­ties are con­sid­er­ing in­tro­duc­ing pro­tec­tive mea­sures against steel im­ports in the near fu­ture. If this does hap­pen, the Euro­pean Union will know how to re­spond ap­pro­pri­ately,” Euro­pean Com­mis­sion chief Jean-Claude Juncker said be­fore talks be­gan Fri­day.

US Pres­i­dent Don­ald Trump has vowed to slap tar­iffs on steel im­ports to pro­tect Amer­i­can in­dus­try, and Wash­ing­ton could start levy­ing the charges as soon as July 13. Cus­toms du­ties on cer­tain steel pipes alone would af­fect im­ports to the US worth $152.6 mil­lion last year. Ger­many ($38.8 mil­lion) and China ($29.4 mil­lion) ac­counted for the big­gest shares, fol­lowed by Switzer­land, In­dia, South Korea and Italy. For its part, the EU has taken mea­sures against some Chi­nese steel prod­ucts, ar­gu­ing that the gov­ern­ment is pro­vid­ing un­fair sub­si­dies to man­u­fac­tur­ers and dis­tort­ing the mar­ket.

Re­venge on the rocks?

Wash­ing­ton’s steel threats have raised hack­les in Europe, push­ing trade dis­putes to the top of the agenda as heads of gov­ern­ment from lead­ing in­dus­tri­al­ized and emerg­ing coun­tries gather for the Ger­many-hosted G20.The event usu­ally ends with a joint com­mu­nique set­ting out how lead­ers will co­op­er­ate on is­sues in­clud­ing global free trade, but de­tails of the word­ing re­mained un­der in­tense ne­go­ti­a­tion Fri­day.

“Europe can’t be placed on the same level with un­fair com­pe­ti­tion prac­tices we don’t en­gage in” like China’s, the French pres­i­dent’s of­fice said, vow­ing a “very speedy” re­ac­tion if the US tar­gets the Old Con­ti­nent’s ex­ports. EU lead­ers have quickly cob­bled to­gether a list of Amer­i­can prod­ucts they could strike back at with sanc­tions, rang­ing from Ken­tucky bour­bon to or­ange juice and dairy prod­ucts, the Fi­nan­cial Times re­ported Fri­day.

Com­mis­sion chief Juncker would not con­firm the de­tails, but in­sisted that Brus­sels was on high alert and would take only “days” to react to US mea­sures. China, which pro­duces around half the world’s steel sup­ply, has been less talk­a­tive on the sub­ject in Hamburg. But Bei­jing raged against the Euro­pean sanc­tions last month, ac­cus­ing Brus­sels of fail­ing to un­der­stand its loan sys­tem. “It is bi­ased and un­fair for Europe to blame China for its own in­dus­trial is­sues,” said Wang He­jun, a se­nior of­fi­cial at the Chi­nese trade min­istry.

Guess­ing game

What­ever text the G20 can agree on will come un­der a mag­ni­fy­ing glass, as the steel row is only the most acute of a long list of com­plaints about trade. At last year’s sum­mit in Hangzhou, China, lead­ers agreed that “ex­cess ca­pac­ity in steel and other in­dus­tries is a global is­sue which re­quires col­lec­tive re­sponses,” set­ting up a mech­a­nism for “in­creased in­for­ma­tion shar­ing and co­op­er­a­tion” to try and ad­dress the prob­lem. Nev­er­the­less, “the Chi­nese haven’t re­ally shared all the in­for­ma­tion” oth­ers were hop­ing for, a source close to the ne­go­ti­a­tions said re­cently. “The sig­nal we have been giv­ing is that we are ab­so­lutely ready to work with the US” to tar­get Chi­nese steel, a se­nior EU of­fi­cial told the Fi­nan­cial Times on Fri­day. How­ever, “it will be very hard po­lit­i­cally to co­op­er­ate on those is­sues if we are not ex­cluded” from the Amer­i­cans’ sanc­tions, they added.


HAMBURG: US Pres­i­dent Don­ald Trump and Bri­tish Prime Min­is­ter Theresa May shake hands dur­ing a bi­lat­eral meet­ing on the side­lines of the G20 Sum­mit in Hamburg yes­ter­day.

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