Trump forges ahead with new tariffs, offers exemption | Business| Economy and finance news from a German perspective | DW | 08.03.2018
  1. Inhalt
  2. Navigation
  3. Weitere Inhalte
  4. Metanavigation
  5. Suche
  6. Choose from 30 Languages

Business

Trump forges ahead with new tariffs, offers exemption

US President Donald Trump has announced import tariffs of 25 percent on steel and 10 percent on aluminum. But he said he was willing to strike a deal that could see Canada and Mexico exempted.

US President Donald Trump signed an order on Thursday that places new import tariffs on steel and aluminum. Set to come into effect in 15 days, the new policy includes exceptions for imports from Mexico and Canada.

Calling steelworkers the "backbone of America," Trump called steel vital to US national security. He added that foreign steel dumping was an "assault" that put US companies and factories out of business. He urged companies to buy American steel and thus avoid import tariffs.

Trump said the new policy would get US steel factories reopened and producing at full capacity.

"A skilled, trained workforce in steel is a crucial element of America's national security and must be protected," Trump said.

Trump said Mexico and Canada would be exempt from the tariffs pending a new NAFTA deal. He said the United States would also be open to negotiations on alternatives to the new tariffs with countries willing to engage in fair trade policies.

"Many of the countries that treat us the worst on trade and on military are our allies," Trump said. "We want fairness. We want everything to be reciprocal."

Global trade war looms

The new tariffs raise the prospect of a global trade war and have already hit stock markets hard. Both the European Union and China have said they would retaliate against action by the United States, as have Mexico and Canada. The US neighbors are engaged in so far fruitless talks with Washington to renegotiate NAFTA.

Watch video 01:17
Now live
01:17 mins.

EU threatens countermeasures

"If Donald Trump puts in place the measures this evening, we have a whole arsenal at our disposal with which to respond," European Financial Affairs Commissioner Pierre Moscovici said before Trump's announcement.

Countermeasures would include European tariffs on US oranges, tobacco and bourbon, he said. Harley Davidson motorcycles have also been mentioned, targeting House of Representatives Speaker Paul Ryan's home state of Wisconsin.

Read more: EU, IMF and WTO warn US President Donald Trump: trade wars are 'easy to lose'

Speaking before Trump, Canadian Prime Minister Justin Trudeau said there was a "level of confidence" that the country's close relationship with the United States will protect it from the measure.

Beijing, which until now had kept largely silent on the issue, sharpened its rhetoric significantly. China's foreign minister, Wang Yi, said any action aimed at Beijing would result in "a justified and necessary response."

Watch video 01:48
Now live
01:48 mins.

EU's riposte 'based on WTO rules'

"Especially given today's globalization, choosing a trade war is a mistaken prescription. The outcome will only be harmful," Wang said on the sidelines of an annual meeting of China's parliament on Thursday.

He also warned that a cascade of trade protectionism risked hurting the global economy, and ultimately the US as well. One lever that China has is US agricultural exports, and it has said in the past that it could target soybeans.

Congressional reaction

Republicans in Congress have urged the president to take a more surgical approach to tackling the problem of China's flooding of global markets with cheap steel.

Read more: Senior Republicans urge Trump to back down on tariffs

"We support your resolve to address distortions caused by China's unfair practices, and we are committed to acting with you and our trading partners on meaningful and effective action," more than 100 Republican members of Congress wrote in a letter to the president late on Wednesday.

Ryan denounced Trump's tariff imposition on Thursday, saying that he feared the "unintended consequences" that the action could bring.

Read more: Donald Trump economic aide Gary Cohn quits amid tariffs dispute

Ryan welcomed the temporary exemptions for Mexico and Canada and pledged to continue to urge the administration to "narrow this policy so that it is focused only on those countries and practices that violate trade law."

Republican chairman of the Senate Finance Committee Orrin Hatch echoed Ryan's concern and criticized the tariffs but also expressed his willingness to work with the White House to "mitigate the damage."

Republican Senator Jeff Flake, who has clashed with the White House before on other issues, strongly condemned Trump's tariff implementation and urged his colleagues to take action. "Congress cannot be complicit as the administration courts economic disaster," he tweeted.

Flake announced that he will introduce a bill to the Senate to nullify the tariffs and appealed to his colleagues to pass it before the administration inflicts "more damage on the economy."

Watch video 02:12
Now live
02:12 mins.

German carmakers fear US import tariffs

uhe, jcg /jd (Reuters, AFP, dpa)

Each evening at 1830 UTC, DW's editors send out a selection of the day's hard news and quality feature journalism. You can sign up to receive it directly here.

DW recommends

WWW links

Audios and videos on the topic

Advertisement