Will likely tariffs on steel and aluminum hit where it hurts?
President Donald Trump has fired a warning shot at the European Union on trade policy, threatening to apply a 25-percent import tariff on steel and 10-percent tariff on aluminum.
If the E.U. wants to further increase their already massive tariffs and barriers on U.S. companies doing business there, we will simply apply a Tax on their Cars which freely pour into the U.S. They make it impossible for our cars (and more) to sell there. Big trade imbalance!
— Donald J. Trump (@realDonaldTrump) March 3, 2018
In related fare, President Trump also fired a series of March 1 tweets stating that “trade wars are good” and “easy to win.”
This latest shot marks Trumps’ earlier stated campaign to protect U.S. trade, widely panned for being a move to appeal to his core base of supporters. It’s the first time aluminum imports have become a focus of this administration’s objectives.
The E.U. is the number one importer of cars to the United States, with the U.S. accepting roughly $57 billion (£42 billion) worth of goods. In response, E.U. leaders, such as E.U. trade commissioner Cecilia Malmström, have issued firm statements about having no choice but to respond.
“Imposing sweeping measures like this generally is not the way forward,” said Malmstrom in a Financial Times interview. “We risk seeing a dangerous domino effect from this.”
Other critics have cited a lack of protocol in affecting multi-lateral trading rules, intended to be flexed only in times where a country’s own industry is affected by excess imports.
Steel imports and aluminum imports could begin shifting sooner than later if the move goes through.