EU's trade chief questions rationale of Trump steel measures

Donald Trump's steel tax Brussels is now threatening to take UK to court

GETTYDonald Trump's steel tax Brussels is now threatening to take UK to court

European Union trade commissioner Cecilia Malmstrom said on Sunday that EU and Japanese officials had held a "frank discussion" with USA trade representative Robert Lighthizer in Brussels, according to the Financial Times. Yet EU trade chief Cecilia Malmstrom said after talks Saturday with USA trade representative Robert Lighthizer she had "no immediate clarity" on whether the bloc would also be let off the hook.

After pressure from allies, the United States has opened the way for more exemptions from tariffs of 25 percent on steel imports and 10 percent on aluminium that U.S. president Donald Trump set last week.

Canada, the top supplier of steel and aluminium to the United States market, has been temporarily exempted from the tariffs, along with Mexico.

"There is no victor in a trade war". That's why Korea needs to view the trade issue from a broader perspective, not just asking the exclude South Korean steelmakers from the new tariff measure. Talks would continue next week. Instead, they support the managed (by government) trade of NAFTA and the World Trade Organization. "We believe that protectionism is a dead end", French Economy Minister Bruno Le Maire told reporters.

We urge the administration to reconsider this action and continue investigating the impact of steel and aluminum tariffs on the USA economy and steel-consuming sectors downstream.

"He only explained the schedule and the procedures", he said.

"The global steel industry is huge and politically powerful, but it accounts for less than two per cent of world trade and only a very small fraction of global gross domestic product (GDP)", said Andrew Kenningham, economist at research firm Capital Economics in a note. "We will look at the impact onJapanese businesses and make a final decision". It will only bring disaster to China, the United States and the rest of the world.

Japan's trade ministry issued a statement earlier on Sunday, saying that Seko told Lighthizer that exports of steel and aluminum from Japan, which is a close ally of the USA, would not affect US national security. It was evident in the European Union legislature in Strasbourg, France, where parties of just about all persuasions lined up to criticize the US plans.

To all of that, add in that the tariffs Trump wants to impose resulted from an investigation by the Department of Commerce that showed that imports of both steel and aluminum are sufficiently high that they pose a national security threat.

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And a move meant to protect the American steel and aluminium industries could actually have the opposite effect for the U.S. industries that use their product - they will be paying more than their overseas competitors for their inputs.

The visit had been planned for weeks as a follow-up discussion on over capacity, seen by observers as a swipe at China.

Trump could then follow through with a threatened new tariff on European-made automobiles.

Commission Vice President Jyrki Katainen warned Washington not to expect any concessions to win an exemption. But if the negotiations do not proceed smoothly, the U.S.' trade actions might send shockwaves throughout the global economy.

The source said that the tariffs would not be limited to technology and telecommunications equipment.

It has already started monitoring incoming metal flows to see whether a surge occurs. A U.S. Treasury spokeswoman did not immediately respond to requests for comment.

Typically, it takes years for the WTO to rule on whether the retaliatory measures are justified, so it is possible that Canada, the European Union and other jurisdictions that feel unjustly injured could simply enact the tariffs and duties now and take their chances that the USA drops its tariffs before it ever gets to the WTO for a ruling.

The overseas suppliers will face reduced sales to the U.S. and a lower price (net of the tariff).

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