President Trump's decision to hike import tariff of steel and aluminium puts nations in a quandary
Mumbai, Mar 3 (IBNS): The global market fears that the decision taken by the United States to impose heavy tariff on imported steel and aluminium may spiral into a trade war, media reports said.
Steel imports will carry a 25% tariff and aluminum imports 10%, reports said.
The European Union and Canada, which are significant players in exporting both items to the US have threatened retaliation if things do not work out, according to media reports, as stock markets reeled following the announcement by the US administration.
On the other hand, tweeted President Trump, "When a country (USA) is losing many billions of dollars on trade with virtually every country it does business with, trade wars are good, and easy to win. Example, when we are down $100 billion with a certain country and they get cute, don’t trade anymore-we win big. It’s easy!"
In another tweet he said, "We must protect our country and our workers. Our steel industry is in bad shape. IF YOU DON’T HAVE STEEL, YOU DON’T HAVE A COUNTRY!"
One of the election promises of US President Donald Trump was to reinstate the steel and aluminium manufacturing industries in the country.
Yet, according to reports, neither industry has seen any significant improvement. Even though steel production rose by three per cent in the first three quarters of last year, the overall industry is still seeing steel workers being laid off, reports said.
Even his 'buy American' executive order did not gain much traction, media reports said.
Incidentally, the US is the world's largest importer of steel.
According to media reports, while Canada and Russia happen to be leading exporters of steel and aluminium to the US; while Brazil, South Korea and Mexico supply significant quantities of steel to the US, the UAE and China are significant suppliers of aluminium.
Many fear that the imposition of higher tariff by the US will impact the industries in their own countries and is also likely to prompt many nations to impose restrictive tariff on US products.
According to reports, many steel exporting countries fear that with US raising tariffs, China - one of the key global exporters of steel -- will look elsewhere to dump their product.
Fortune quoted European Commission vice president Jyrki Katainen as saying,“We can end up easily in a situation where we are in a trade war with the two fronts. And only because of one decision made by the president of the United States.”
The Indian steel industry has still now laid low regarding the decision by US President Donald Trump, media reports said.
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