Trump postpones steel tariff decision

As steel tariffs squeeze U.S. businesses uncertainty threatens economic growth
EU makes last-minute attempt to avert US trade war

01 May, 2018

President Donald Trump hasn't decided whether to extend relief for allied nations from US steel and aluminum tariffs, creating uncertainty in global metals markets with temporary exemptions set to expire in less than 24 hours.

The European Commission, which oversees trade policy for the 28 EU members, has insisted that the United States grant it a permanent exemption without conditions.

As a last attempt to gain exemption from the tariffs and avoid a trade war between the European Union and the United States, several representatives from the European Union are taking action.

The confrontation stems from the president's decision in March to slap tariffs of 25 percent on imported steel and 10 percent on imported aluminum.

Goods include sweetcorn and cranberries, along with Kentucky bourbon, cigars, jeans and motorcycles. After all: A tariff is simply a sales tax on imported goods.

Treasurer Scott Morrison said he has "no doubt" exemption would be honoured, while Trade minister Steven Ciobo said he expects a "deal that's been reached" between Prime Minister Turnbull and President Trump earlier this year to be honoured.

May 1, International Labor Day, is going to be busy for the European Commission in Brussels, as the US's tariffs exemption on EU steel and aluminum is set to expire at midnight eastern time in the US.

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"We're looking to have a very frank discussion on trade, on the issues of the trade imbalance", he said ahead of remarks due later on Monday at a conference in Beverly Hills, California. "President Trump has been very clear for the past year that he's very focused on the trade deficit, and we're looking to correct that".

In their last phone call, Ross was rebuffed by Malmström after he demanded that the EU voluntarily limit exports of steel and aluminium to 90 per cent of the average 2016/17 level, reducing European imports by 16.3 per cent.

Canada is hoping to win another exemption, along with Mexico, as all three countries continue their efforts to negotiate changes to the North American Free Trade Agreement.

The EU has argued that the USA tariffs are "essentially" safeguard measures, despite the fact that Washington said its actions were to protect national security. The U.S. imposed the tariffs after concluding foreign shipments imperil its security.

The EU tariffs would hit US consumer, agricultural and steel products in many key Republican constituencies, putting pressure on Trump ahead of crucial midterm elections in November.

"So in order for the exemptions to be extended or made permanent, a new proclamation would have to come from us like the original ones did".

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