The US plans to impose tariffs on European steel and aluminum after threatening the EU with this move for months, the Wall Street Journal reported on May 30 quoting sources aware of the issue.
According to the WSJ, Washington is expected to announce its decision on May 31.
In March, US President Donald Trump imposed news tariffs of 25 % for steel and 10 % of aluminum. The EU and other allies were promised temporary exemptions to allow for future negotiations.
On May 30, top trade officials from the US came to Paris to met their EU counterparts and discuss exemptions on tariffs, which expire on June 1. During the negotiations, US Secretary of Commerce Wilbur Ross reportedly hinted that the EU would face tariffs. However, he stressed that Washington intends to discuss a possible deal that opens markets in Europe to US exports.
“It’s not that you can’t talk just because there are tariffs,” Ross said
“God knows there are plenty of tariffs the EU has in place on us.”
European representatives stressed that they plan to impose tariffs on as much as $3.3 billion in US exports. According to rules of the World Trade Organization, members are allowed to punish a country for inappropriately seeking a “safeguard” against their exports.
French Minister of the Economy and Finance Bruno Le Maire stressed that Europe will defend its own interests if Washington imposes tariffs.
“We French and Europeans don’t want a trade war. But if we’re attacked, we will have to defend our interests,” Le Maire said.
The WSJ pointed out that Washington is planning to cancel exemptions now, stressing that tariffs are induced by a threat to the national security.
The EU officials criticized this reason:
“We have not seen any analysis that shows these exports pose a problem to national security,” the EU ambassador in Washington David O’Sullivan said.
“If the United States wants to open discussions on a possible sort of trade deal, we don’t think slapping tariffs on our aluminum and steel exports is a way to start off.”
The discussions were fueled when Ross drew a sharp line with the EU over Chinese trade talks. He stressed that Europe is using tariffs as an “excuse” to refuse trade negotiations.
“China are paying their tariffs,” Ross said.
“China hasn’t used that as an excuse not to negotiate … It’s only the EU that is insisting we can’t negotiate if there are tariffs.”
US officials hinted that the June 2-4 trade talks between China and the US could not happen if the EU and Washington do not reach any agreement on tariffs.
French President Emmanuel Macron stressed that the world’s biggest economic powers should reshape the World Trade Organization rules and prevent growing tensions, according to Reuters. He pointed out that Europe should not show weakness in the face of unilateral action.
“All sides always lose in a trade war,” Macron said.
“The new rules must meet the current challenges of world trade: massive state subsidies creating distortions of global markets, intellectual property, social rights and climate protection.”
“A trade war is always a war lost by everyone.”