EU and Japan press US on steel and aluminium tariffs

EU and Japan press US on steel and aluminium tariffs

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Top EU and Japanese trade officials said that they would continue to press their case for exemptions from punitive US steel tariffs, after a meeting with Washington’s top trade representative on Saturday failed to provide clarity on how countries can apply for carve outs.

Cecilia Malmström, the EU trade commissioner, said after the meeting that “discussions will continue next week” with US authorities after a “frank discussion” with US Trade Representative Robert Lighthizer in Brussels failed to yield assurances on whether the EU would be hit by the 25 per cent tariffs on steel and 10 per cent tariffs on aluminium that Donald Trump announced on Thursday.

Saturday’s EU-Japan-US meeting had been intended as an opportunity for the three countries to develop a joint front in dealing with China over what they argue is the country’s overproduction of steel. Instead, Donald Trump’s decision to hit out with additional tariffs meant that the gathering turned into a chance for two of the US’s major economic partners to demand answers as to why they are potentially in the administration’s crosshairs.

Hiroshige Seko, Japan’s minister of trade and industry, told reporters after Saturday’s meeting that he still hoped that Japan could secure an exemption. In comments reported by Reuters, he said the measures “could disrupt the steel and aluminium Markets of the world and have a negative impact”.

Mr Trump has hailed the tariffs as an example of his determination to protect core US industries. While Canada and Mexico were granted an explicit, temporary exemption, other countries have been left only with vague guidance that the rules will be applied flexibly.

The announcement has led to countries clamouring for carve outs while also preparing countermeasures that it is feared could lead to a wider trade war. Brussels warned on Friday that it was fully prepared to take retaliatory action against some €2.8bn of US imports, ranging from motorcycles to peanut butter.

Nations have also rebuffed Mr Trump’s attempt to justify the tariffs on national security grounds. In a statement after Saturday’s meeting, the European Commission noted that both the EU and Japan were “longstanding security partners” of the US.

One person briefed on the talks said that Mr Lighthizer had not been able to provide further clarity on who would be excluded, or on the procedure for applying for exemptions. Further guidance is expected from Washington in the coming days. A spokeswoman for Mr Lighthizer declined to comment.

The discussions in Brussels come as the Trump administration is trying to straddle two separate tracks in its approach to China. Besides the issue of steel, Washington is also in the final stages of an Investigation into Beijing’s intellectual property practices that is expected to lead to a mix of tariffs and Investment restrictions.

While economic nationalists in the administration have been pushing for a strong slate of tariffs, others have been trying to work with the EU and Japan, arguing that an international alliance would have a better chance of promoting real change in China.

Even as Mr Lighthizer came under pressure from the EU and Japan over the tariffs, the three countries nevertheless agreed a series of actions to tackle overcapacity in the global steel Market.

In a joint statement published after the meeting, they pledged to co-ordinate on the issue within the WTO, as well as in other forums such as the G20.

The plans include working to improve the “effectiveness and efficiency” of WTO monitoring of trade practices, and to design stronger international rules on industrial subsidies.


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