US trading partners hit back on steel, aluminium tariffs

WASHINGTON: Major US trading partners announced countermeasures Wednesday to President Donald Trump’s blanket steel and aluminium tariffs, hours after the levies took effect in a salvo that fuelled trade tensions globally.

The steep 25-percent levies came into place after midnight with no exemptions despite countries’ efforts to avert them, in an escalation of Trump’s fresh duties already imposed on Canada, Mexico and China since he returned to the White House.

The European Commission swiftly unveiled retaliation starting in April, while Canada announced additional tariffs on US goods and China vowed “all necessary measures” in response — as Washington edged toward an all-out trade war with allies and competitors alike.

The European Commission will implement a series of countermeasures from April 1 in response to Washington’s “unjustified trade restrictions,” with chief Ursula von der Leyen saying the retaliation was “strong but proportionate.”

Canada, which is heavily exposed to the US steel and aluminium levies, announced additional tariffs of CAN$29.8 billion ($20.7 billion) on US goods, with the levies coming into force Thursday. These will hit products that include computers and sports equipment, said Canadian finance minister Dominic LeBlanc.

His country supplied about half of US aluminium imports and 20 percent of its steel imports, according to a recent note by EY chief economist Gregory Daco.

Besides Canada, Brazil and Mexico are also key US suppliers of steel, while the United Arab Emirates and South Korea are among the major providers of aluminium. Wednesday’s levies stack atop earlier ones, meaning some Canadian and Mexico steel and aluminium products could face higher tariff rates unless they comply with the US-Mexico-Canada Agreement (USMCA), making them eligible for a temporary reprieve.

US Trade Representative (USTR) Jamieson Greer criticized the EU’s promises of retaliation, calling the bloc’s economic policies “out of step with reality” while blaming it for failing to help address global excess capacity.