U.S. President Donald Trump has said that his administration will impose a 25 percent tariff on all steel imports, in a move likely to invite retaliation from some of its top allies including the European Union (EU), Canada and South Korea. “It opens up a Pandora’s box for how trading partners might respond,” CNN Money quoted a researcher as saying.
President Trump announced that the United States will “impose a 25 percent tariff on steel imports and 10 percent tariff on aluminum” during a meeting with steel and aluminum executives at the West Wing on Thursday (local time). Out of the three options recommended to Trump as a result of the Commerce Department’s earlier investigation of the Section 232 of the Trade Expansion Act, he chose an option to impose across-the-board tariffs of 24 percent on steel and 7.7 percent on aluminum, but with higher tariffs.
During the meeting, Trump vowed to rebuild American steel and aluminum industries, saying that he would sign a formal order next week. He also said that they would be in effect “for a long period of time,” signaling that the latest protectionist action will be put in place basically with no time limit. Canada, the largest supplier of steel to the United States, immediately expressed opposition to the new sanctions, saying that it would take responsive measures to defend its trade interests and workers. The European Union also announced that it would impose trade countermeasures. U.S. media have voiced concern that the new tariffs would not only raise the prices of steel and aluminum products but also undermine the relationship with allies.
South Korea, for the time being, was not hit with the worst-case scenario in which the United States would impose a tariff of at least 53 percent on steel from 12 countries including South Korea and China, as suggested in one of the recommendations. Still, the new sanctions will greatly hurt the steel manufacturers of South Korea, the third-largest steel exporter to the United States.
In response to President Trump’s latest move, South Korea’s Trade, Industry and Energy Minister Baek Woon-gyu presided over a meeting on Thursday to discuss countermeasures and assess the new tariffs’ impact on domestic industries.
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