Steel tariffs put US security at risk, says May
Ambassador cites defence project in challenge to US claims linking steel levies to national security
THERESA MAY has warned Donald Trump that tariffs on British steel will harm US security, in her latest attempt to avert a trade war.
The Prime Minister called on the president to “permanently exempt” the UK and the EU from tariffs, reminding him of the importance of British specialist steel products to the US military.
Joint defence projects include the construction of a new generation of ballistic missile-carrying submarines.
BRITISH officials are using a sensitive joint programme – the construction of next generation, ballistic missile submarines – to argue against the steel tariffs in a fierce lobbying drive in Washington, The Daily Telegraph has learnt.
Currently both countries are working together on building Dreadnoughtclass submarines for Britain, which will eventually carry Trident nuclear missiles, and Columbia-class submarines for America.
Both have a common part that is made from UK steel but constructed in the US, meaning it will be affected by Donald Trump’s steel tariffs, increasing costs.
Kim Darroch, the British ambassador in Washington, has brought up the programme repeatedly with US congressmen to question the Trump administration’s claim that national security is at risk from steel imports.
Theresa May, the Prime Minister, expressed her disappointment at the US administration’s protectionist decision, highlighting the role of UK metal manufacturers in defence projects “which bolster US national security”.
The argument is said to have had a sympathetic hearing in the Pentagon, with whom the UK works closely. Britain and America are believed to be the only nations working together on new ballistic missile submarines.
The disclosure was made after Cecilia Malmström, EU trade commissioner, said the US was “playing a dangerous game” following the decision by Mr Trump to press ahead with the levies. There could be no question of the European Union negotiating with the US on trade until it took “the gun away from us” and sat down with the bloc as equals, Ms Malmström said.
Exactly how the EU will hit back, and whether or not it will follow through on some or all of its potential retaliatory measures, will be decided by June 20, according to Ms Malmström.
The trade chief confirmed that the EU was sending two complaints to the World Trade Organisation, the global arbiter of trade disputes.
British cabinet minsters have been investigating whether the UK can carve out its own exemption from steel tariffs after Brexit, in a move that risks infuriating Brussels.
There is a belief that the UK is only being affected because it is part of the EU, which is the real focus of the Trump administration’s frustration – in particular German car exports.
Donald Trump last night said America’s allies “take advantage of us economically” as he defended his decision to impose new steel and aluminium sanctions. He said: “You take the European Union and you see the kind of tariff they charge that we don’t, that’s called ‘not fair trade’. I want fair trade. I like free trade, but at a minimum I want fair trade.”
Pushing for a Uk-only carve out from tariffs while still in the EU has been deemed illegal in Whitehall, but such a move could be pursued after March 2019 when Britain has left. However, that could have consequences for the Brexit transition period, during which time the UK would hope to retain some benefits of EU membership while phasing in changes over time.
Mrs May’s statement in response to the trade dispute made a distinction between the UK and the EU and referred to separate exemptions.
She said: “The EU and UK should be permanently exempted from tariffs and we will continue to work together to protect and safeguard our workers and industries.”