Washington: US President Donald Trump has announced that he would impose hefty tariffs on imported steel and aluminium to protect US producers, risking retaliation from major trade partners like China, Europe and neighbouring Canada. He said the duties, 25 per cent on steel imports and 10 per cent on aluminium would be formally announced next week. “We are going to build our steel industry back and our aluminium industry back,” Trump said.
Shares of US domestic steel and aluminium makers rallied, but shares of companies ranging from auto makers to airplane makers fell on the potential impact of the higher costs they will have to pay for the metals. The announcement came after a night of “chaos” in the White House after the resignation of Hope Hicks. Tariffs were sharply criticised by senior Republican lawmakers and industries ranging from autos to oil to construction equipment. A major concern is that US farm exports could be hit hard in retaliation by steel-exporting countries. Senator Pat Roberts said, “Every time you do this, you get a retaliation. Agriculture is the number one target. I think this is terribly counterproductive for the agriculture economy.”
The announcement found immediate friction from other countries, with China already threatening to curb imports of US soybeans, and the European Union considering actions as well. President Xi Jinping's top economic adviser Liu He held talks with the Trump Administration in Washington, which was described as “frank and constructive”. A White House official said it focused on “ways to ensure fair and reciprocal trade.”
Canadian Foreign Affairs Minister Chrystia Freeland sent out a sharply worded statement saying, “Should restrictions be imposed on Canadian steel and aluminium products, Canada will take responsive measures to defend its trade interests and workers.”
