USA trading partners, businesses predict tariffs will backfire

Trump is not the first protectionist president

'We had your backs': Trudeau on country's steel and aluminum workers

He temporarily exempted big steel producers Canada and Mexico - provided they agree to renegotiate a North American trade deal to his satisfaction.

The new tariffs, signed into law on Thursday and going into effect about 10 days from now, impose a broad 25% tariff on steel imported from nearly anywhere on the globe (and 10% tariffs on aluminum, too).

The EU said it hoped to be exempt from the tariffs, like Canada and Mexico are, or that the issue might be solved in global arbitration at the World Trade Organization.

Trump's tariffs, like his hardline NAFTA demands, have the prospective to turn the internationally integrated auto industry upside down.

While no further bilateral meetings are planned at the moment, contacts are ongoing as the European Union is racing against time to secure an exemption before the aluminum and steel tariffs are enacted in less than two weeks.

In recent days he has also widened his rhetoric against Europe to include more trade beyond steel, and said Monday that Commerce Secretary Wilbur Ross would speak to his counterparts to consider reducing tariffs that were "not fair to our farmers and manufacturers".

"These measures could make a significant impact on the economic and cooperative relationship between Japan and the USA, who are allies", said Taro Kono, Japan's trade minister, in a statement.

"Without the capacity cutting, there would have been much more production than there is now", said Wang Suzhen, an analyst for Mysteel, a news service that follows the Chinese industry.

"We have been, and will continue to be, in steady communication with the government of Canada to ensure that no steel diversion is taking place as a result of the tariffs imposed by the United States", said Galimberti.

Trump has also tweeted a trade war is easily winnable. "Are there things that we can be doing?" "You guys know that, right?" These gains have been enormous for everyone: The expansion of worldwide trade from 1980 to 2005 launched the greatest period of poverty reduction in world history, with a billion people moved out of abject poverty.

Notwithstanding conventional wisdom, it is not as easy as you might think for the United States to impose economic or trade penalties on Canada. High tariffs enacted on electronics and clothing, which the USA buys a lot of from China, would sharpen trade frictions and risk economic side effects in the US such as inflation. Apparently being conscious of that, Trump left room for further negotiations over exemptions for more countries.

These agreements cover agriculture, application of sanitary and phytosanitary measures and a host of other details.Other agreements have been made between specific countries, like those the US has between Israel (1985), Canada and Mexico (NAFTA, 1994), Jordan (2001), Australia (2004), Chile (2004), Singapore (2004), Bahrain (2006), Morocco (2006), Oman (2006), Peru (2007), the Dominican Republic (2007), Panama (2011), Colombia (2011) and South Korea (2011), as listed by Wikipedia.

So far, the United States government has not even been able to give its trading partners, including Europe, a set of guidelines that would allow them to win exemption.

Right now China isn't even among the top 10 producers of US steel imports. But Congress wasn't imposing tariffs; the president was.

That's because previous tariffs on Chinese steel have already reduced the volume of imports from China. South Korea needs to closely monitor its exports to the U.S.as well as American companies' move to file a complaint against Korean firms.

China's aluminium output is a fraction of steel's size at about 36 million tonnes previous year. South Korea needs to work with the worldwide community to develop practical measures to tackle Washington's growing trade protectionism effectively and also sharpen the global competitive edge of the local steel industry.

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