The European Union has warned that it could impose additional duties on a number of imports from the US in response to the Trump administration’s decision to impose additional duties of 25 per cent and 10 per cent respectively on imports of steel and aluminium from the EU.
But the dispute is already hitting supply chains, according to Gareth Stace, director of UK Steel, the section of the EEF that represents steel producers.
EU trade commissioner Cecilia Malmström said: “We will now trigger a dispute settlement case at the WTO, since these US measures clearly go against agreed international rules. We will also impose rebalancing measures and take any necessary steps to protect the EU market from trade diversion caused by these US restrictions.”
Stace said: “US steel consumers are already reporting price increases and supply chain disruption and with some half billion dollars of steel exported from the UK to US last year, UK steel producers are going to be hit hard,” said Stace.
The US measures affect EU exports worth €6.4 billion in 2017.
The EU has already put together a list of US products that could face additional tariffs. It notified the World Trade Organisation on 18th May which means those tariffs could come into force on 17th June.
UK Steel’s Gareth Stace said: “Even with the imposition of tariffs, it is vital that the EU and US continue discussions to find a way through the current impasse and reach an agreement that works for all parties. At the same time, it is only correct that the EU forges ahead with safeguard action, to shield against diverted trade swamping the European market, as well as its challenge to the US tariffs through the WTO.”
The Confederation of British Industry warned against a protectionist domino effect and pointed out that the UK is the largest foreign investor in the United States and British companies support more than one million jobs.
Ben Digby, CBI international director, said: “We hope that the USA will swiftly reconsider its decision, and we will be pressing home the importance of our transatlantic relationship with our counterparts and government figures in Washington, London and Brussels to protect the free and fair trade that is the key to our economic future.”