EU Condemns Trump’s Decision to Double Steel Tariffs, Threatens Countermeasures
The European Union has voiced its “strong regret” over Donald Trump’s sudden announcement to significantly hike US tariffs on imported steel and aluminum. The unexpected plan, revealed during a rally in Pittsburgh, risks plunging ongoing bilateral trade talks into disarray and escalating transatlantic trade tensions.
Trump stated on Friday that the import tax on steel and aluminum would soar from the current 25% to a hefty 50%, with the increase set to take effect the following Wednesday. He claimed the move was intended to revitalize the local steel industry, bolster national supply chains, and reduce reliance on countries like China.
EU Reaction: Undermining Talks and Warning of Costs
In response, the European Commission, the EU’s executive body, delivered a sharp rebuke on Saturday. They asserted that Trump’s latest tariff escalation “undermines ongoing efforts” to reach a mutually agreeable trade solution. The Commission highlighted that, in a gesture of good faith, the EU had paused its previously planned countermeasures on April 14th to create space for continued negotiations.
Now, however, the bloc is signaling readiness to retaliate, declaring it is “prepared to impose countermeasures.” The EU warned that doubling the tariffs “adds further uncertainty to the global economy” and will inevitably “increase costs for consumers and businesses on both sides of the Atlantic.” Experts note that such tariff hikes can lead to ripple effects, potentially contributing to rising prices across various industries and for consumers.
UK Steel Industry Faces “Body Blow” Amidst Pending Deal
The tariff hike also casts a shadow over the UK’s trade relationship with the US, particularly regarding steel and aluminum. The UK had recently agreed in principle to a zero-tariff deal with the US on these materials following Brexit, becoming the first country to clinch a trade agreement with the US earlier in the month. However, this specific deal has not yet been formally signed, leaving the UK vulnerable to the new tariffs.
UK steelmakers reacted with alarm, describing the doubling of tariffs as “yet another body blow” to an already struggling industry. Trade group UK Steel noted the move plunges the industry further into confusion, especially given the pending agreement to eliminate tariffs. Concerns were raised about immediate order cancellations and uncertainty surrounding shipments already en route across the Atlantic. While UK exports to the US are relatively small (£700 million annually), the market is important, particularly for specialist steel used in critical applications like nuclear submarines, which the US might find difficult to source elsewhere.
The UK government stated it is “engaging with the US on the implications” of the announcement to seek clarity for the industry and remains committed to protecting British businesses and jobs. The UK Business Secretary is reportedly scheduled to meet their US counterpart next week to agree on a timeline for the UK’s exemption from the tariffs, emphasizing that UK steelmakers should not bear the cost of the hike.
Trump’s Rationale and Broader Context
During his Pittsburgh rally, Trump linked the tariff increase to a claimed $14 billion investment in the area’s steel production via a partnership between US Steel and Japan’s Nippon Steel, although he later conceded he had yet to see or approve the final deal. He also promised steelworkers no layoffs or outsourcing and a $5,000 bonus each, prompting enthusiastic applause from the crowd.
The announcement is the latest development in Trump’s often unpredictable approach to tariffs since re-entering office. It comes as the US steel manufacturing sector has seen a decline in recent years, with roughly a quarter of the steel used in the US being imported. Globally, countries like China, India, and Japan lead production.
The decision also follows a period of tense negotiations with the EU regarding tariffs. Just last week, Trump had agreed to extend a deadline for these talks to July 9th, following previous back-and-forth actions including an initial 20% tariff on most EU goods in April, a reduction to 10% for talks, and an earlier threat to raise the rate to 50% as soon as June 1st.
While Trump’s broader global tariffs have faced legal challenges, including a recent court battle over their legality, the steel and aluminum tariffs were reportedly unaffected by a specific appeals court ruling that temporarily reinstated certain taxes after a lower court had ordered them blocked.
The EU’s “strong regret” and warning of countermeasures signal that the sudden tariff hike is seen not just as a trade barrier but also as potentially undermining diplomatic efforts and increasing economic uncertainty on both sides of the Atlantic, putting renewed pressure on sensitive transatlantic trade relations.
References
- https://www.bbc.com/news/articles/cx2eg42nzpwo
- https://www.bbc.co.uk/news/articles/cx2eg42nzpwo
- https://www.bbc.com/news/articles/c17rzvvzr0ko
- https://www.freedom969.com/eu-commission-strongly-regrets-announced-increase-in-us-steel-tariffs/
- https://finance.yahoo.com/topic/tariffs/
