US tariffs on steel and aluminium from the EU have been confirmed, sparking strong reaction from UK industry and governments around the world.
(Credit: Skeeze via Creative Commons)
Though first tabled over two months ago, the tariffs (25 per cent on steel and 10 per cent on aluminium) were delayed for some close allies of the US as interim talks took place. But yesterday, US commerce secretary Wilbur Ross said insufficient progress had been made, and the tariffs have now come into effect for the EU, Canada and Mexico.
UK trade secretary Liam Fox called the move “patently absurd” when speaking to Sky News, and Canadian prime minister Justin Trudeau said the move was an “affront” to Canadians, particularly as it had been carried out under the pretext of national security. The EU, Canada and Mexico have all said that comparable measures will be taken in response to the US tariffs.
In the UK, the CBI has called for restraint, urging the EU to avoid “any disproportionate escalation” of the situation. It claims that working with the US is the best way forward, and the only option to protect British industry and jobs.
“Overproduction can distort the global market and erode the level playing field that business depends on to stay competitive,” said Ben Digby, CBI international director.
“But this is a shared challenge whose root causes should be tackled jointly by the EU and the USA. There are no winners in a trade war, which will damage prosperity on both sides of the Atlantic. These tariffs could lead to a protectionist domino effect, damaging firms, employees and consumers in the USA, UK and many other trading partners.”
Elsewhere, UK Steel was more forthright in its criticism of President Trump’s actions, saying the US economy is just as likely to suffer from the tariffs as outside territories.
“It is difficult to see what good can come of these tariffs,” said UK Steel director, Gareth Stace.
“US steel consumers are already reporting price increases and supply chain disruption and with some half-billion dollars of steel exported from the UK to US last year, UK steel producers are going to be hit hard.”
Stace is also in agreement with the CBI that collective international action, rather than tariffs, is the only sensible way to address the problems in the steel market.
“As stated time and time again, the only sustainable solution to the root cause of the issue, global overcapacity in steel production, is multilateral discussions and action through established international channels,” he said.
“President Trump had already loaded the gun and today, we now know that the US Administration has unfortunately fired it and potentially started a damaging trade war.
“This is a bad day for the steel sector, for international relations and for free trade.”