President Trump's Secretary of Commerce to Talk Tariffs with EU


Eduardo Solis, president of the Mexican Automotive Industry Association and a former trade negotiator, said the US already was going out on a limb by claiming that the steel and aluminum tariffs were needed for national security. Congressional approval is not needed.

"The American steel, aluminum industry has been ravaged by aggressive foreign trade practices", he said. Its exemption is a ground for optimism that likewise, South Korea as a Washington ally will likely be included in the list of countries exempted from the tariffs.

The administration argued that healthy steel and aluminum industries are vital to the national defense.

"These new tariffs will cause significant harm to the nation's construction industry, put tens of thousands of high-paying construction jobs at risk, undermine the president's proposed infrastructure initiative and potentially dampen demand for new construction projects for years to come".

Why are steel and aluminum makers being singled out?

But the atmosphere in the US Commerce Department is said to be unfavourable. Beijing's explosive output has depressed global metals prices and forced US domestic companies to reduce production and cut jobs.

Chinese leaders have threatened in the past to retaliate against raised trade barriers, but have yet to take direct action following Trump's announcement.

He also singled out China in a speech about unfair trading practices that he described as "an assault on our country".

That's because previous tariffs on Chinese steel have already reduced the volume of imports from China. Meanwhile, one U.S. study has estimated that the tariffs will bring back around 33,500 jobs in steel and aluminium, but ultimately result in a net loss of 146,000 jobs across the whole USA economy.

Brazilian authorities intend to use the next two weeks to convince the US not to impose the new barriers on imported steel. That will be hard according to people actually watching the negotiations as Trump's trade team, led by trade czar Robert Lighthizer and commerce chief Wilbur Ross, are asking for things that Canada and Mexico would never give.

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"If national security is that Mexico sends steel, or Canada sends steel, two of the [U.S.] great allies, then I don't know what national security has to do with this", Solis said at a news conference before Trump's decision to exclude Mexico. Renegotiations over NAFTA began last summer. Many trade experts say the fate of Trump's trade agenda rests to a large degree on whom he anoints as his next economic adviser.

He said the tariffs would correct trading imbalances going back decades that had harmed the USA job market and threatened U.S. manufacturers. Indeed, most European Union countries are in North Atlantic Treaty Organisation, the world's biggest security alliance, together with the U.S. "It is bad for European citizens, for Dutch citizens and it will turn out bad for US citizens as well".

Won't all these exemptions weaken protections for US manufacturers?

Haven't heard the word "tariff" since high school government class?

How will USA trading partners likely respond?

But there are critics of Trump's tariff threat on his own side of the border, and within his own party. Tokyo's trade envoy met with Ms. Malmstrom before the trilateral meeting with the USA, urging the European Union to respond cautiously to the tariffs because tit-for-tat retaliation wouldn't be in anyone's interest.

By giving countries a potential sanctuary from tariffs, Trump might have temporarily lowered the temperature. It will also consider filing a complaint with the World Trade Organization, or WTO, through worldwide cooperation.

Trudeau said the national security argument the US has made when it comes to considering tariffs for Canadian steel and aluminum makes no sense - a refrain he's hammered in recent weeks.

If the WTO threw out the USA tariffs, the president _ already critical of WTO rulings against America _ might be tempted to pull out of the organization. That could unleash a protectionist free-for-all, damaging to the global economy - something the WTO was created to prevent.