Donald Trump’s trade war has expanded to cover the world, with 25% tariffs on all steel and aluminium imports to the US in effect from today.
The duties were announced in mid-February as stock market investors cheered President Trump‘s ‘America first’ agenda which saw only Mexico, Canada and China come under initial pressure.
While two rounds of tariffs on China have been enacted, 25% duties on some Canadian and most Mexican cross-border trade have been withdrawn until 2 April at the earliest.
The tariffs beginning today are designed to protect US manufacturing and bolster jobs by making foreign-made products less attractive.
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They threaten to make the cost of things like cars to soft drink cans – and therefore some drinks – more expensive.
Canada is the biggest exporter of both steel and aluminium to America. However, the White House on Tuesday rowed back on a threat to double the country’s tariff to 50%.
The EU is to retaliate with €26bn of counter tariffs on US goods starting from 1 April, the European Commission said on Wednesday morning.
Commission president Ursula von der Leyen said she remained open to “meaningful dialogue” with the US.
During Mr Trump’s first term, the bloc countered with charges on products such as bourbon and jeans.
The American tariffs are also a threat to UK steel exports – worth north of £350m annually – with the bulk of that coming from stainless steel.
The business secretary Jonathan Reynolds said on Wednesday morning that while he was disappointed, there would be no immediate retaliation by the UK government as negotiations continue over a wider trade deal with the US.
“I will continue to engage closely and productively with the US to press the case for UK business interests,” he said.
