By Joyce Yu
Philadelphia, PA–The Trump administration will impose 25% tariffs on steel and 10% on aluminum from Canada, Mexico and the European Union, three of America’s biggest trading partners. The trade penalties, which will take effect at midnight, are expected to escalate trade tensions and push prices for Americans on a range of everyday products.
This decision comes after EU trade commissioner Cecilia Malmström and U.S. Commerce Secretary Wilbur Ross met in Paris on Wednesday which appears to have failed. But the tariffs were in fact originally announced on March 1 when President Donald Trump said that the United States was being treated unfairly. Canada was the largest exporter of steel to the United States by value last year, according to data from Wood Mackenzie, with Mexico ranked the third. These two countries and the EU had been granted temporary tariff exemptions which are due to expire Friday.
In response, Canada and Europe had promised firm retaliation if trade penalties were imposed. The French Finance Minister, Bruno Le Maire, said Thursday that Europe would take “all necessary measures” to respond. German Finance Minister Olaf Scholz also said in an interview with Reuters Thursday that the EU’s response to the tariffs must be “clear, strong, and smart.” The EU had warned it could quickly respond with 25% tariffs on US products ranging from motorcycles, denim, cigarettes, cranberry juice and peanut butter, according to a CNN report.
But there could be more actions in the pipeline. It is reported the U.S. is also exploring the possibility of putting new tariffs on cars following an investigation by the Trump Administration last week on whether automobile imports are hurting US national security, dropping hints for another trade fight. Without disclosing any details, German magazine WirtschaftsWoche reported that Trump told French President Emmanuel Macron last month he would maintain his trade policy with the aim of stopping Mercedes-Benz models from driving down Fifth Avenue in New York, according several unnamed U.S. and European diplomats quoted by the magazine.
Experts are equally confused with President Trump’s trade policies. “The way the United States has dealt with trade policy, it’s so difficult to predict what will happen,” Ross Denton, a trade expert and partner at law firm Baker McKenzie, told CNBC. “I don’t see any particular benefit to the Trump administration to, frankly, pissing the European Union off.”
The United States is now in open conflict with more key trading partners besides China. On Tuesday, the White House said the U.S. is moving forward with tariffs on $50 billion worth of Chinese goods. Ross is scheduled to go to China this weekend for a third round of negotiations.
