Biden official says protecting US steel is a national security issue

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Joe Biden’s Commerce Secretary warned that protecting U.S. steel was a matter of national security, adopting the stance of his predecessor Donald Trump as European and U.S. officials rushed to avoid a tariff escalation later this year. year.

Trump imposed high tariffs on steel and aluminum imports from Europe and other countries in 2018, controversially justifying the measure on national security grounds.

The EU has fought back with its own tariffs on a range of US imports, but put aside plans to increase those tariffs in May in a move to settle the dispute. Tariffs should be applied in early December.

“We would like to reach a resolution,” Gina Raimondo told the Financial Times. “Having said that, we need to protect the US steel industry. For each year in the 10 years preceding the imposition of tariffs, we have never exceeded 80 percent of our capacity. It is a risk to national security, it is an economic risk.

Valdis Dombrovskis, the EU trade commissioner, held meetings with Raimondo and US trade representative Katherine Tai earlier this week as the two sides tried to strike a deal.

Tai said the countries were discussing “intensely” to reach an agreement.

European officials have insisted that the EU does not pose a threat to US national security, although they have recognized that global excess capacity threatens both the European and US steel industries.

Negotiators have given themselves until early December to reach an agreement, which also aims to address the excess supply of steel resulting from production in countries including China. However, Dombrovskis said this week that the EU should strike a deal with the United States by early November to give it time to prepare to lift or reimpose tariffs on American products. EU officials say it is impossible to suspend tariffs for the second time.

The removal of tariffs will be politically painful for the US president, as they are popular within the politically powerful steel industry and in factory states including Indiana, Ohio and Pennsylvania, which will be heavily contested during the elections. next elections.

While EU officials initially hoped for a removal of tariffs with nothing to replace them, Dombrovskis said Europe was “ready to watch [at] other solutions, understanding the fact that the United States is also interested in protecting its steel industry ”.

The US could also come up with some form of export quota, although the EU has already ruled it out. Or it could opt to convert tariffs into “safeguards” designed to cope with a sudden influx of imports, although these are difficult to reconcile with World Trade Organization rules.

The tariff talks are part of a larger US and EU effort to strengthen transatlantic ties after the bitterness of the Trump years.

Earlier this year, the EU and the United States agreed to suspend a 17-year dispute over aircraft subsidies, lifting the threat of billions of dollars in punitive tariffs on their economies to boost transatlantic relations.

The deal takes the form of a five-year deal to suspend punitive tariffs related to the original disagreement. Added to this is the creation of a ministerial-level working group to discuss the limits of grants and overcome any problems that may arise between the two parties.


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