Tata, EU steel firms brace for tariff war

Hannah Rogers
June 1, 2018

Economists are of the view that tariffs on steel and aluminium imports could help local producers of the metals by making foreign products more expensive, however, they might not be beneficial to the United States manufacturers.

Trump was accused of firing the starting pistol on an global trade war, as the United States administration slapped swingeing new tariffs on European Union steel imports.

But she says they could hit Canadian businesses, some of which say they are watching closely to see how the dispute unfolds. NAFTA renegotiations will be put in jeopardy by this move as well-the Trade Partnership estimates that withdrawal from NAFTA would cost the country a staggering 18 million jobs in the first year alone.

The White House defended the move by invoking national security as it stated excessive levels of aluminum and steel imports threatened to impair the security of the United States.

The US administration also launched a national security investigation last week into vehicle and truck imports, using the same 1962 law it has applied to curb incoming steel and aluminium.

The Trump administration's decision to impose punishing new tariffs on Canadian steel and aluminum could have dire consequences for Canada's defence sector and drive up the price of new military equipment, federal ministers said Thursday.

Trudeau fired back at the USA and Trump's "totally unacceptable" tariffs with $12.8 billion worth of their own tariffs on US imports into Canada on products ranging from yogurt to toilet paper.

Mr Fox said: "It's very disappointing that the United States has chosen to apply steel and aluminium tariffs".

The European Union was "a peace project, including on trade", Mogherini said.

"Throughout these talks, the USA has sought to use the threat of trade restrictions as leverage to obtain concessions from the EU", said Cecilia Malmstrom, EU Commissioner for Trade.

Canada's Prime Minister Justin Trudeau listens to Foreign Minister Chrystia Freeland during news conference in Ottawa, Ontario, Canada, May 31, 2018.

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Canada and Mexico, which are top steel exporters to the United States, have also said they would pursue countermeasures.

The U.S. would also be taken to the World Trade Organization (WTO) by Canada for the newly imposed tariffs, an action already taken by China, India and some other countries.

A list of countermeasures would include tariffs on US metals and food products such as yogurt, pizza and cucumbers, as well as household products like mattresses and refrigerators.

The U.S. decision came despite last-minute talks in Paris this week to try to reach a deal.

Jean-Claude Juncker, president of the European Commission, said the bloc would move ahead with tariffs that are expected to affect roughly $7.5 billion worth of U.S. exports.

The Mexican government plans to retaliate with comparable penalties on U.S. products including lamps, pork, fruit, cheese and flat steel.

The measures announced on Thursday ended months of uncertainty about possible exemptions, illustrating a hardening of the Trump administration's stance towards trade negotiations.

Branding the move by U.S. president Donald Trump as "just protectionism", he said: 'We absolutely do not rule out counter measures.

Ross said that while not much progress has been made in negotiations with the European Union, the NAFTA negotiations with Canada and Mexico is taking longer than expected.

But the White House also said the administration is still committed to "good-faith negotiations with our allies".

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