U.S. may tie NATO contributions to tariff exemptions

WASHINGTON — U.S. allies seeking to avoid the steel and aluminum tariffs approved by President Donald Trump might be asked to step up their financial commitments to NATO.

Treasury Secretary Steve Mnuchin told CNBC in a Friday interview that the president will consider national security, noting that Trump wants to be sure that NATO gets more funding from European allies who Trump has previously criticized for not contributing enough.

“If we’re in NATO, he wants to make sure that NATO gets more money so that NATO can protect all of us and fulfill its goal,” Mnuchin said, underscoring Trump’s push to get NATO allies to pay 2 percent on defense.

Trump drew on rarely used national security grounds to place a 25 percent tax on steel imports and 10 percent tax on imported aluminum. Only Canada and Mexico — both partners in the North American Free Trade Agreement being renegotiated — were excluded from the tariffs.

The Treasury secretary said he has been speaking with his foreign counterparts and “my expectation is there may be some other countries that he considers in the next two weeks.”

Other countries seeking exemptions from the tariffs will have to make their case through U.S. Trade Representative Robert Lighthizer, but the president will make the ultimate decision, a senior administration official told reporters Thursday. Specific steel and aluminum products could also be excluded and that authority will rest with Commerce Secretary Wilbur Ross.

Lighthizer was expected to be in Brussels this weekend for meetings with European and Japanese trade officials.

The EU has warned that it could retaliate with tariffs on U.S. steel, agricultural and other products, such as peanut butter, cranberries and orange juice.