EU says metal tariffs ‘prolong uncertainty’ after US holds off
BRUSSELS: The European Union accused the United States of prolonging ‘market uncertainty’ with its decision to hold off on imposing controversial tariffs on metal imports from key global trading partners.
The 25 per cent tariffs on steel and 10 per cent duties on aluminium – a key tenet of US President Donald Trump’s ‘America first’ approach to worldwide trade – were due to go into effect on Tuesday.
But after renewed fears of a trade war spooked Wall Street, Trump said he was holding off the levies, offering a 30-day reprieve to Canada, Mexico and the EU.
The European Union, Germany and France all called for EU nations to be permanently excluded from the punishing tariffs.
“The US decision prolongs market uncertainty, which is already affecting business decisions,” the European Commission, the bloc’s executive arm, said in a statement.
European Parliament president Antonio Tajani tweeted: “We expect EU to be exempted from duties once and for all.
We play by the rules – let’s work together to isolate those who don’t.”
Speaking just hours after Trump granted the EU an extension, US Commerce Secretary Wilbur Ross said the move was justified, “because we’re having some potentially fruitful discussions about an overall reduction in trade tensions between the EU and ourselves.”
“We’re hopeful that something good will come out of it,” Ross said, and added that the US does not plan to provide “protracted extensions” to the tariff exemptions.
Europe – which last year exported over US$ 7.7 billion of steel and aluminium to the US market – had lined up its own punitive tariffs on American imports, including iconic items like Harley-Davidson motorbikes, blue jeans and bourbon whiskey.
Britain, the EU’s second-largest economy, welcomed Trump’s ‘positive’ decision but warned against further protectionist measures from the White House.
Trump on Monday has said the “necessary and appropriate means to address the threat to the national security” posed by the metal imports is to “continue these discussions and to extend the temporary exemption of these countries.”
The US also announced it had finalised a trade deal with South Korea, which includes several concessions made by Seoul, including extended tariffs on pick-up trucks and a quota on its steel exports.
Washington has “agreements in principle” with Argentina, Australia and Brazil, “the details of which will be finalised shortly,” a White House statement said.
“In all of these negotiations, the administration is focused on quotas that will restrain imports, prevent transhipment, and protect the national security.”
Extensions for Canada and Mexico had been expected, as Mexico City, Ottawa and Washington work on revamping the North American Free Trade Agreement.
Canada exported over US$12 billion of steel and aluminium to the United States in 2017, with another US$ 3 billion from Mexico.
But an extension for the EU had been less of a foregone conclusion.
The EU’s three largest economies – Britain, France and Germany – held crisis talks on Sunday and the French presidency said afterwards they had agreed “the EU must be ready to act” if Washington presses ahead with the tariffs.
“We agree that there is a problem of excess capacity in the steel and aluminium sector. We are ready to work with the United States and other partners to find quick and appropriate solutions,” France’s Foreign Minister JeanYves Le Drian and Finance Minister Bruno Le Maire said in a statement.
“But we can only do that calmly when we are certain of being permanently exempted from the threat of unilateral tariff increases.”
Axel Eggert, director general of the European Steel Association ( EUROFER), said Tuesday the month-long exemption was “welcome, if temporary.”
“Despite all the evidence of the harm to the EU- US relationship – and to our respective economies – the Administration has opted to continue a policy of uncertainty in its international trade practice,” he said. — AFP