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EU may target $3.5bn of US imports for trade retaliation

  • Published at 12:59 am March 4th, 2018
EU may target $3.5bn of US imports for trade retaliation
The European Union is considering applying 25% tariffs on around $3.5bn of imports from the United States if President Donald Trump carries out his plan to apply global duties to steel and aluminium, EU sources say. The European Commission has said it would respond “firmly” to proposed US import duties of 25% on steel and 10% on aluminium. It has spelt out it would join others in a challenge at the World Trade Organization (WTO) and consider safeguard measures, last deployed in 2002, to guard against steel and aluminium being diverted to Europe from elsewhere if US tariffs come in. A further counter-measure under consideration would specifically target the United States to “rebalance” trade between the two, EU sources say. The US tariffs would be officially brought in on grounds of national security, but the European Union says US military requirements represent no more than 3% of US production and that the measures are really a form of protectionism for US manufacturers. EU exports of steel to the United States in 2017 were worth €5.3bn and of aluminium €1.1bn. For certain grades of steel, the United States cannot show there was any increase of imports last year, the EU sources say, meaning it would not be allowed to apply safeguard measures to them. For the EU, exports of those grades amounted to €2.8bn. Assuming US tariffs fully covered EU steel, the European Union would put forward 25% tariffs on €2.8bn worth of goods from the United States. About a third would be steel grades, another third other industrial products and final third agricultural products. The list of products is set to be presented next week to EU countries, whose approval would be needed. The “rebalancing” would have to take place within three months.