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The planned imposition of Donald Trump 25 percent of steel and aluminum imports reprise one of his biggest trade moves during the first term of the President.
In March 2018, Trump introduced 25 percent on steel and 10 percent on aluminum against most countries, using national security as justification, before expanding them to the EU, Canada and Mexico in June.
Trump claimed that he would reduce trade deficit and increase domestic production.
American metal imports immediately fell. A total of about 6.4 billion euros from steel and aluminum exports from the EU were affected. It took Brussels for three months to answer, but then imposed billing at about 2.8 billion euros in the import of the US, which contains about one-third of steel and aluminum, one third of agricultural products and one third of the other goods.
The block has singled out iconic US products, which are often produced in a Republican voice, such as Bourbon Whiskey, Harley-Davidson Motorcycles and jeans. The annual American export of whiskey in the EU has since fallen by the third, which is a loss of about $ 256 million, according to the US Council for Distilled Pentecost.
EU import tariffs, however, have become full of exemptions after US manufacturers have successfully argued that they need imports of certain degrees of metals and parts.
Car companies, including General Motors and Ford, were also forced to reduce the forecasts of earnings or missed expectations of analysts in 2018 due to tariff uncertainty, as well as the growing costs of raw materials caused by the duties of steel imports in the United States.
Although many American car manufacturers bought most of their steel locally, they were still affected while domestic steel producers took the opportunity to encourage their prices. Manufacturers also increased their own effect relatively shortly after the imposition of tariffs.
Trump later approved several trade partners, including Canada and Mexico, without a version.
After Trump left his duty, the United States, the EU, Japan and the United Kingdom agreed a temporary truce when then President Joe Biden partially removed the tariffs, arranging quotas above which duties were applied to metals. The EU has frozen all its measures.
The truce is a consequence of passing on the EU side at the end of March, while US quotas that replaced the tariffs will expire at the end of the year.
Supervision tariffsHowever, investors in those industries that are most exposed to are already disregarded.
Shares in some European steel manufacturers fell on Monday morning after Trump’s announcement. Arcelormittal, which generates about 13 percent of the US sales, is strongly exposed. The company sells steel products with high value in the US, especially from its Canadian operations, a key supplier of the US car sector. It also supplies semi-empty steel products from Mexico into its contents in the US.
The Company’s Chief Director insisted, however, that any influence will be controlled on the basis of what happened in 2018, when higher prices compensate for higher costs.
The car industry will be affected again – with the possibility that the exemption can once again alleviate the blow. This time the threat of the tariff comes because manufacturers are already confronted with switching to electric vehicles and firmer emissions standards, which makes it difficult for them to absorb higher raw material costs.
Volvo Cars has already warned of less profitability this year, citing uncertainty about Trump’s tariffs. “There will be a tariff.. You will see some geopolitics and some changes in politics, so it will create a general turbulence,” said Jim Rowan, executive director of the Swedish Group last week.
