Trump imposes tariffs on closest allies, Mexico and Europe announce retaliation
U.S. President Trump waves before boarding Air Force One to depart for travel to Texas from Joint Base Andrews in Maryland on May 31. (Leah Millis/Reuters) May 31 at 11:37 AM Email the author
President Trump Thursday imposed tariffs on imported steel and aluminum from the European Union, Canada and Mexico, triggering immediate retaliation from U.S. allies against American businesses and farmers.
The tariffs â" 25 percent on steel and 10 percent on aluminum â" will take effect at midnight Thursday, marking a major escalation of the trade war between the U.S. and its top trading partners.
In response, the E.U. said it would impose duties âon a number of imports from the Unite d States,â referring to a 10-page list of targets for retaliation it published in March, which included Kentucky bourbon and Harley-Davidson motorcycles. European leaders also vowed to proceed with a complaint to the World Trade Organization.
âThis is protectionism, pure and simple,â said Jean-Claude Junker, president of the European Commission.
The Mexican government said it would levy import taxes on U.S. exports of pork bellies, blueberries, apples, grapes, certain cheeses, and various types of steel.
President Trump had announced the tariffs in March, but gave several U.S. allies temporary exemptions while they negotiated potential limits on shipments to the United States.
Commerce Secretary Wilbur Ross said the president acted on national security grounds, seeing a rising tide of imports as a threat to the domestic metals industry. âWithout a strong economy, you canât have a strong national security,â Ross said.
Officials from the three trading partners â" among Washingtonâs closest allies for decades â" have dismissed the idea that their shipments to American customers endanger the United States â" and some prominent Republicans attacked it as wrongheaded.
âThis is dumb. Europe, Canada, and Mexico are not China, and you donât treat allies the same way you treat opponents,â said Sen. Ben Sasse (R-Neb.). âWeâve been down this road beforeâ"blanket protectionism is a big part of why America had a Great Depression. âMake America Great Againâ shouldnât mean âMake America 1929 Again.â
The United States negotiated voluntary export limits with several other friendly nations, including South Korea, Argentina, Australia and Brazil. Ross said that he intends to continue talks with European diplomats and officials from Canada and Mexico, but those are likely to be contentious.
âWe continue to be quite willing, indeed eager, to have further discussions with all of these parties,â Ross told reporters, speaking from Paris where he is attending meetings at the Organization for Economic Cooperation and Development.
Thursdayâs action also is expected to complicate U.S. efforts to confront China over trade practices that the administration regards as unfair. The E.U. shares many of Washingtonâs concerns about Chinaâs efforts to acquire advanced technology through compulsory licensing practices, cybertheft and other measures.
But European officials are increasingly irritated by Trumpâs aggressive use of obscure provisions in U.S. trade laws against U.S. allies.
âWe are deeply disappointed that the US has decided to apply tariffs to steel and aluminium imports from the EU on national security grounds. The UK and other European Union countries are close allies of the US and should be permanently and fully exempted from the American measures on steel and aluminium,â Britain said in a statement. âWe will defend the UKâs interests robustly. We continue to work closely with our EU partners and will consider carefully the EUâs proposals in response.â
President Emmanuel Macron has couched Trumpâs tariffs as a ânationalist retrenchmentâ reminiscent of Europe in the 1930s.
Germany has perhaps the most to lose among E.U. nations if the spat escalates into a full-blown trade war.
Although the U.S. market amounts to a low single-digit percentage of German steel industry output,
German politicians and industry groups have said they are concerned that tit-for-tat measures could end in damaging tariffs on foreign automobiles, an outcome that Trump has repeatedly threatened.
The administration earlier in May opened a trade investigation into vehicle imports, with the possibility it will end in tariffs on foreign cars justified by the same ânational securityâ provision used to implement the metals tariffs.
While Thursdayâs action cheered Amer ican steel producers, companies that use imported metals said that it endangered U.S. jobs and investment. Auto parts makers said that they rely upon global supply chains and sometimes can buy their specialty steel and aluminum from only one or two sources worldwide.
âOur members could face having to pay double tariffs on some materials necessary to manufacture parts in the US,â said a statement from the Motor & Equipment Manufacturers Association. âIndustries like ours, which require long-term investments in facilities and employees, depend on regulatory and market stability. These actions have thrown all of that up in the air.â
Trump also drew fire from members of his own party, who generally favor fewer trade restrictions. âBad news that @POTUS has decided to impose taxes on American consumers buying steel and aluminum from our closest allies --Canada, the EU, and Mexico (with whom we run a trade surplus on steel),â tweeted Sen. Patrick Toomey (R-Pa. ). âIn addition to higher prices, these tariffs invite retaliation.â
Ross, meanwhile, said that he still plans to leave for China on Friday for the resumption of trade talks. Earlier this week, there were reports that the talks might be canceled following Trumpâs renewed threat to impose import taxes on $50 billion in Chinese products.
James McAuley contributed reporting from Paris and Griff Witte reported from Berlin.Source: Google News