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US President Donald Trump has signed an order imposing a 25 per cent tariff on imported steel, and 10 per cent on imported aluminium, in a bid to protect the US’ aluminium and steel industry. The tariffs are to take effect in 15 days, reported The Straits Times (Singapore).
But the President walked back from an earlier proposal to apply the tariffs across the board - which had sparked global fears of a trade war.
The order exempted Canada and Mexico - both major sources of imports. It also leaves room for other countries to negotiate exclusions from the new tariffs.
“We have to protect & build our Steel and Aluminum Industries while at the same time showing great flexibility and cooperation toward those that are real friends and treat us fairly on both trade and the military,” Mr Trump tweeted earlier on Thursday (March 8).
He told reporters as he signed the order, flanked by selected steel and aluminium workers holding their hard hats : “Our industries have been targeted for decades by unfair trade practises. That’s going to stop. We are finally taking action to correct this long overdue problem.”
“It’s been an assault on our country," he said. "Other countries have added production capacity that far exceeds demand, flooding the world with cheap metal. It takes China about one month to produce as much steel as is produced in the United States in an entire year.”
The exemptions to Mexico and Canada appear to be conditioned on the two countries agreeing to terms favourable to the US, in ongoing renegotiation of the North American Free Trade Agreement (NAFTA) which Mr Trump has blamed for job losses in American manufacturing.
If NAFTA negotiations are unsuccessful then tariffs will be applied across the board, Dr Peter Navarro, Director of the White House National Trade Council told Fox News.
“Now, importantly, in addition to that, there is language that will allow other countries to effectively propose ways that they could get a similar dispensation in exchange for more fair and reciprocal trade with the United States,” he said.
The tariffs are being imposed in the name of national security. But they are also in line with Mr Trump’s long-held protectionist beliefs, and fulfill a promise to steel workers to protect them.
And they are also aimed at China, which while exporting a relatively small amount of steel and aluminium directly to the US, accounts for roughly half of world steel supply.
“Global excess capacity fuels the importation of steel and aluminum into the United States,” the White House said in a statement.
“Global excess steel capacity has reached 737 million metric tons. In 2016, China’s excess aluminum production alone totaled 3.9 million metric tons, more than four times that of US production. International efforts to address this problem have been insufficient,” it said.
America’s steel and aluminium industry currently employs about 140,000. The trend has been downward. Employment in iron and steel mills and ferroalloy production has dropped by more than 54,000 since the beginning of 2000, the White House said. More than 40,000 jobs in alumina and aluminum production have been lost since the beginning of 2000.
Despite considerable growth in demand, six primary aluminum smelters have permanently shut down since 2012, the White House said. The loss of skilled steel and aluminum workers... would be problematic in the event of a major production surge or mobilization, it said.
America’s steel industry had been “decimated during the past decades by steel imported into our country at lower prices than domestic manufacturers can sustain,” the statement said.
The United States imported five times as much primary aluminum as it produced in 2016. Aluminum and steel is used in a range of ground weapons, ships and aircraft.
“There is only one remaining U.S. producer of an important category of steel used in electrical transformers, a type of critical infrastructure and only one high volume producer of armor plate,” it said.
“There is only one high-volume producer of the high-purity aluminum needed for defense aerospace applications,” it added.
The tariff decision has caused ripples of concern globally, and at home where there is fear the price of steel will rise and in the longer run, cost American jobs in steel- and aluminium-dependent sectors.
But it has been welcomed by the steel industry. On Wednesday one company, Pittsburgh-based US Steel, announced it would reopen a blast furnace and resume steel making at a plant in Illinois, bringing 500 former employees back to work two and a half years after they were idled.
In a statement on its website dated March 3, another steel manufacturer, ArcelorMittal USA, said: “We believe the remedies will provide the additional measures required to ensure the competitiveness of the steel industry in the US.”
Australia is in limbo over Donald Trump’s trade war, but if we’re exempt it could be thanks to an unlikely savior, reported News.com.au (Australia).
The US President has talked up the US-Australian relationship this morning, singling out Australia as an “ally” that may not face the steel and aluminium tariffs he is imposing.
Speaking to reporters this morning, he specifically noted Australia as a country that may receive a special deal.
“We have a very close relationship with Australia, we have a trade surplus with Australia, great country long term partner we’ll be doing something with them,” Mr Trump said.
He also said his administration would be “flexible” with the tariffs, and look at our trade relationships with other countries to determine who would and would not be affected.
But despite Mr Trump’s comments about America’s relationship with Australia, there is no deal to exempt us from the tariffs.
The tariffs will become effective in 15 days, with exemptions for Canada and Mexico taking place “immediately”, according to officials.
“Depending on whether or not we reach a deal — also very much involved with that is national defence — but if we reach a deal it’s most likely that we won’t be charging those two countries the tariffs,” Mr Trump said.
Australia has been frantically lobbying for exemptions over the past few days, after the President suggested earlier that no one would be immune.
Greg Norman, a friend of the president’s, was reportedly one of the key influencers who convinced him to reconsider imposing tariffs on Australia.
On Wednesday, the former champion golfer issued a letter with several business leaders playing on security concerns to argue for exemptions for Australian companies, The Australian reports.
“The value of Australia’s trading of steel and aluminium with the United States is an industry worth $545 million to Australia’s economy, which might be adversely affected should those tariffs be extended to include Australia or these companies,” the letter said. “Crippling these industries in our critical Pacific ally could seriously jeopardise our own power projection, readiness and repair capabilities in the Southern Hemisphere.”
China’s steel and metals sector demanded on Friday that the government retaliate against the United States for imposing heavy tariffs on steel and aluminium imports, reported South China Morning Post (Hong Kong).
The China Iron and Steel Association and the China Nonferrous Metals Industry Association said in separate statements the government should take counter measures against US products.
The penalties should cover steel, coal, agriculture, consumer electronics, recycled aluminium and luxury consumer goods, the statements said.
US President Donald Trump has signed off on tariffs of 25 per cent on steel and 10 per cent on aluminium imports.
The move was sparked warnings of a trade war with China and US allies in Europe, but Canada – which represents 41 per cent of US steel imports – and Mexico are exempted from the tariffs.
Wang Hejun, head of the trade remedy and investigation bureau at China’s Ministry of Commerce, said on Friday that most US’ steel and aluminium imports were for civilian use and the US move was trade protectionism under the guise of national security.
“The US abused the ‘national security exemption’ clause, which causes reckless damage to the multilateral trade system represented by the World Trade Organisation and is set to strike heavily on the normal global trade order. China firmly opposes his,” said Wang.
“China will take forceful measures after assessing China’s losses by the US measure to firmly defend its reasonable interests,” he said.
Wang called on the US to respect the authority of the international trade system and revoke the measures.
The China Iron and Steel Association said: “Trump’s behaviour is a challenge to the global steel industry and will definitely encounter opposition from more countries.”
China’s Foreign Minister Wang Yi accused the US on Thursday of using the “wrong remedy” to tackle trade disputes and vowed to take action.
The steel and aluminium tariffs have drawn a global backlash and sources say the European Union is working on counter measures.
China only accounts for about three per cent of steel imports to US, but it is widely expected that the Trump administration may further launch trade sanctions against China in the coming weeks.
Trump has repeatedly accused Beijing of adopting trade practices which unfairly penalise US firms, boosting America’s trade deficit with China.
A US government investigation is also underway into claims of widespread theft of American companies’ intellectual property by Chinese firms.
show source http://www.straitstimes.com/world/united-states/donald-trump-introduces-25-per-cent-tariff-on-steel-10-per-cent-on-aluminium http://www.news.com.au/finance/economy/world-economy/australia-may-end-up-avoiding-trumps-tariffs/news-story/4300f9