Donald Trump, President of the United State, US, offered the prospect of relief from steel and aluminum tariffs to countries that “treat us fairly on trade” on Thursday, a gesture apparently aimed at strengthening pressure on Canada and Mexico to give ground in separate trade talks.
Trump was expected to sign a proclamation imposing 25 percent tariffs on steel imports and 10 percent on aluminum on Thursday, but this could slide into Friday. The range of potential exemptions for allies and for industries has made the final outcome unpredictable.
In addition to exemptions, there could be a consultation period that would lead to intense lobbying by industry and a growing group of disgruntled Republican lawmakers who oppose the tariffs proposed by their fellow Republican president.
“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,” Trump said in a post on Twitter.
Talk of tariffs has raised the prospect of a global trade war and hit stock markets hard. Both the European Union and China have said they would retaliate against action by the United States, as have Mexico and Canada. The U.S. neighbors are engaged in so far fruitless talks with Washington to renegotiate the North American Free Trade Agreement.
“If Donald Trump puts in place the measures this evening, we have a whole arsenal at our disposal with which to respond,” European Financial Affairs Commissioner Pierre Moscovici said.
Counter-measures would include European tariffs on U.S. oranges, tobacco and bourbon, he said. Harley Davidson motorcycles have all been mentioned, targeting the home state of House of Representatives Speaker Paul Ryan.
“We want Congress to understand that this would be a lose-lose situation,” Moscovici told BFM TV.
Canadian Prime Minister Justin Trudeau sought to strike a soothing tone on Thursday, saying there was a “level of confidence” that the country’s close relationship with the United States will protect it from U.S. tariffs.
Trudeau’s negotiators in the NAFTA talks have rejected the American proposals to link the tariffs and the trade talks, and an attempt by Washington to split Canada and Mexico has also been rejected.
Even as Trump threatened tariffs and his NAFTA partners, 11 nations gathered in Chile to sign a landmark Asia-Pacific trade pact, one that Trump withdrew from on his first day in office in January last year. Reuters report.
