Trade war escalates as Trump metal tariffs take effect

[mwai_chat context=”Let’s have a discussion about this article:nn6 minutes agoShareSaveJoão da SilvaBusiness reporter, BBC NewsReporting fromSingaporeShareSaveReutersTariffs imposed by US President Donald Trump on imports of steel and aluminium have taken effect in a move that will likely escalate tensions with some of America’s largest trading partners. It sparked an immediate response from the European Union which said it will impose counter tariffs on billions of euros of US goods.Trump hopes the tariffs will boost US steel and aluminium production, but critics say it will raise prices for US consumers and dent economic growth, as US markets sunk on Monday and Tuesday in response to recession fears.On Tuesday, Trump u-turned on doubling the tariffs on Canada specifically in response to a surcharge Ontario had placed on electricity.The tariffs mean that US businesses wanting to bring steel and aluminium into the country will have to pay a 25% tax on them.The EU announced retaliatory tariffs on Wednesday in response on goods worth €26bn (£22bn).They will be partially introduced 1 April and fully in place on 13 April.European Union President Ursula von der Leyen said she “deeply regrets this measure” adding that tariffs are “bad for business and worse for consumers”. “They are disrupting supply chains. They bring uncertainty for the economy. Jobs are at stake, prices up, nobody needs that, on both sides, neither in the EU or the US.”She said the EU’s response was “strong but proportionate” and that the EU remains “open to negotiations”.However, the American Iron and Steel Institute (AISI), a group representing US steelmakers, welcomed the tariffs saying they will create jobs and boost domestic steel manufacturing.The group’s president Kevin Dempsey said the move closed a system of exemptions, exclusions and quotas that allowed foreign producers to avoid tariffs. “AISI applauds the president’s actions to restore the integrity of the tariffs on steel and implement a robust and reinvigorated program to address unfair trade practices,” Mr Dempsey added. The US is a major importer of aluminium and steel, and Canada, Mexico and Brazil are among its largest suppliers of the metals. ‘No exceptions’Other countries also responded immediately to the move.Trade Secretary Jonathan Reynolds said he was disappointed and “all options were on the table” to respond in the national interest.Australia’s Prime Minister, Anthony Albanese, said the Trump administration’s decision to go ahead with the new tariffs is “entirely unjustified”.Albanese, who had been trying to secure an exemption to the tariffs, said Australia will not be imposing retaliatory duties because such a move would only drive up prices for Australian consumers.Meanwhile, Canada’s Energy Minister, Jonathan Wilkinson, told CNN his country would retaliate but added that Canada is not looking to escalate tensions.Canada, is one of America’s closest trade partners, and the largest exporter of steel and aluminium to the US.In 2018, during his first term as president, Trump imposed import tariffs of 25% on steel and 10% on aluminium, but carve-outs were eventually negotiated for many countries.This time the Trump administration has signalled that there will be no exemptions.British steelGareth Stace, director general at industry body UK Steel, said the US move was “hugely disappointing”.Some steel company contracts have already been cancelled or been put on hold, he said, adding that customers in the US will have to pay £100m per year extra in the tax.He said he shared Trump’s concerns about cheap steel flooding the market, but urged for him to work with the UK rather against it.”Surely President Trump realises that …nnDiscussion:nn” ai_name=”RocketNews AI: ” start_sentence=”Can I tell you more about this article?” text_input_placeholder=”Type ‘Yes'”]