US allies including the EU will get a pause on metal tariffs - but China has no such luck
The EU, Australia, Brazil and South Korea will get a temporary pass from the Trump administration on steel and aluminium tariffs
The European Union, Australia, Argentina, Brazil and South Korea are among those that will get an initial exemption from looming steel and aluminium tariffs from the Trump administration, US Trade Representative Robert Lighthizer said on Thursday.
US President Donald Trump is planning to impose tariffs of 25 per cent on imported steel and 10 per cent on aluminium - trade penalties aimed at China for flooding the world with cheap steel and aluminium.
Lighthizer told the Senate Finance Committee that there are countries involved in various stages of trade talks with the US, and that Trump decided “to pause the imposition of tariffs with respect to those countries.”
The trade official also cited Canada and Mexico in his list. The US is in consultations with the two countries in an effort to renegotiate the North American Free Trade Agreement (Nafta).
Lighthizer identified the countries initially exempted from the tariffs in response to a question from Democratic Senator Ron Wyden, who said lawmakers wanted more consultation from the administration on trade.
“Which countries - this is going to happen tomorrow - will not have these steel and aluminium tariffs applied to them?” Wyden said.
“The list I just gave,” Lighthizer said.
Before Lighthizer’s congressional testimony, Germany’s economy minister, Peter Altmaier, said he had found officials in Washington “open to our arguments” during a recent visit with the EU trade commissioner, Cecilia Malmstrom.
Altmaier told Germany’s parliament “it is a question of fundamental significance: whether we all stand for open and fair world markets in the future.”
Trump campaigned on promises to bring down America’s trade deficit, which stood at US$566 billion last year, by rewriting trade agreements and cracking down on what he called abusive commercial practises by US trading partners.
But Trump was slow to turn rhetoric to action. In January, he imposed tariffs on imported solar panels and washing machines. Then he announced the steel and aluminium tariffs, saying reliance on imported metals jeopardises US national security.
Lighthizer said the nation’s trade deficit indicates that the global rules on trade sometimes make it hard for US companies to export.
“We are negotiating trade deals that will work for Americans,” he said.
The administration “is seeking to build a better, fairer system of global markets that will lead to higher living standards for all Americans,” Lighthizer said.
Republican Senator Orrin Hatch of Utah, the committee chairman, said he was “deeply disappointed in the decision to impose global tariffs to address a problem caused by China.”