World Economy

Countries Exempted From US Steel Tariffs Will Face Quotas

Countries Exempted From US  Steel Tariffs Will Face QuotasCountries Exempted From US  Steel Tariffs Will Face Quotas

Every country granted an exemption from US President Donald Trump’s tariffs on steel and aluminum imports will face an import quota and other restrictions, White House trade adviser Peter Navarro said Tuesday.

“The guiding principle of this administration, from the president down to his team, is that any country or entity like the European Union, which is exempt from the tariffs, will have a quota and other restrictions,” he said at a meeting of steel industry executives hosted by the American Iron and Steel Institute and the Steel Manufacturers Association, Politico reported.

Navarro added such measures “are necessary to defend the aluminum and steel industries from imports in defense of our national security.”

Meanwhile, Trump has decided to grant Canada, Mexico and the European Union an additional 30 days to work out deals to avoid the penalties—a move that John Ferriola, the CEO of Nucor Corp., earlier labeled “disappointing”.

Negotiations will continue for the next 30 days with the 28-member bloc, as well as Canada and Mexico. The White House said this would be the final period to reach a deal with the key trading partners.

The administration has also reached agreements in principle on tariffs with Australia, Argentina and Brazil, which are expected to be completed in the next month.

The countries, which represent major metals exporters to the United States, have been in negotiations for weeks with the Trump administration to avoid steep tariffs of 25% on steel and 10% on aluminum.

But the continued focus on quotas and other restrictions is unlikely to be well-received by Canada, Mexico and the EU, which have repeatedly stated that they expect a full exemption from the duties.

The additional 30-day delay, Ferriola said, “is giving these countries that have been dumping into our country another month to get their steel into our country before their tariffs or quotas go into effect.”

For the EU, however, no such negotiations are underway, and it remains unclear what can be worked out in the next 30 days. The bloc serves as the largest single supplier of steel to the US, sending $6.2 billion across the Atlantic last year.

The European Commission has already criticized Trump for simply delaying the duties, rather than canceling them outright. “The US decision prolongs market uncertainty, which is already affecting business decisions,” the commission said in a statement.

The EU said that Trump’s decision has prolonged business uncertainty and the EU should get a permanent exemption.

Germany, whose trade surplus has attracted criticism from Trump, said it too expected a permanent exemption, with neither side having an interest in escalating trade tensions.

Trump has invoked a 1962 trade law to erect protections for US steel and aluminum producers on national security grounds, amid a worldwide glut of both metals that is largely blamed on excess production in China.

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