A 25% tariff imposed by US President Donald Trump on imports of steel and aluminium has taken effect, marking the first time in Trump’s second term that a tariff has been applied to all countries.
“The higher it goes, the more likely it is they’re going to build.”
Donald Trump, US President
“It may go up higher,” Trump announced at an event hosted by the Business Roundtable. “The higher it goes, the more likely it is they’re going to build,” he added, referring to more companies moving their production to the US.
The announcement sparked an immediate response from the European Union which said it will impose counter tariffs on billions of euros of US goods.
Trump hopes the tariffs will boost US steel and aluminium production, but critics have stated it will raise prices for US consumers and dent economic growth, as US markets plummeted earlier this week in response to recession fears.
On 11th March, Trump reversed his previous decision to double the tariffs on Canada specifically in response to a surcharge Ontario had placed on electricity.
The tariffs mean that US businesses wanting to bring steel and aluminium into the country will have to pay a 25% tax on them.
The EU announced retaliatory tariffs on Wednesday in response on goods worth €26 billion (£22 billion).
They will be partially introduced 1 April and fully in place on 13 April.
European Union President Ursula von der Leyen said she ‘deeply regrets’ the EU’s retaliatory tariffs, announced on 12th March, adding that tariffs are ‘bad for business and worse for consumers’.
''Jobs are at stake, prices up, nobody needs that, on both sides, neither in the EU or the US."
Ursula von der Leyen, European Union President
European Union President Ursula von der Leyen said she ‘deeply regrets’ the EU’s retaliatory tariffs, announced on 12th March, adding that tariffs are ‘bad for business and worse for consumers’.
"They are disrupting supply chains. They bring uncertainty for the economy. Jobs are at stake, prices up, nobody needs that, on both sides, neither in the EU or the US."
The American Iron and Steel Institute (AISI), a group representing US steelmakers, welcomed the tariffs saying they will create jobs and boost domestic steel manufacturing.
The group's president Kevin Dempsey said the move closed a system of exemptions, exclusions and quotas that allowed foreign producers to avoid tariffs.
The US is a major importer of aluminium and steel, and Canada, Mexico and Brazil are among its largest suppliers of the metals.
Source: BBC