EU likely to impose safeguard measures on steel imports by mid-July

European Commissioner for Trade Cecilia Malmström attends a debate at the European Parliament in Strasbourg, France, 14 March 2018. [Patrick Seeger/EPA/EFE]

As the trade war with the US escalates, the EU is considering imposing provisional safeguard measures on steel imports, Trade Commissioner Cecilia Malmström told the press on Tuesday (26 June).

“We are seriously contemplating to have provisional measures in place,” probably by mid-July, the Commissioner said. Which form they will take, import tariffs or quotas, “is still under discussion,” Malmström clarified.

The Commission launched an investigation in March, as part of its response to the U.S. restrictions on steel and aluminium. The aim was to determine whether steel products were disrupting the EU market.

Although the EU foresees provisional actions as it waits for the investigation results, “it will take until the end of the year to get the whole picture,” the Commissioner said.

Consumers to be collateral damage of EU-US trade dispute

Harley-Davidson announced on Monday (25 June) it would move some production out of the US to avoid EU tariffs and it might not be the last to do so. That has prompted European consumers’ organisations and importers to warn of the negative impact on consumers.

Companies react to retaliatory measures

After EU retaliatory measures – tariffs on a number of US products – entered into force last Friday, Harley Davidson announced it would move part of its production outside the US.

The Commissioner did not want to speculate if other companies might do the same. However, the US administration knew that imposing tariffs on steel and aluminium was to be considered illegal and “there will be consequences,” she highlighted

“The consequences are that the American business, the American companies and the American consumers, who we don’t want to punish but that is the unfortunate consequence, will react and they will put pressure on the American administration. That they would say: ‘Hey, this is not good for the American economy’. And that is what is happening,” Malmström said.

EU to respond to any US auto tariff move

The European Union will respond to any US move to raise tariffs on cars made in the bloc, a senior European Commission official said, the latest comments in an escalating trade row.

Dispute on cars continues

Instructed by President Donald Trump, U.S. Secretary of Commerce Wilbur Ross initiated an investigation on whether imports of automobiles and automotive parts into the US could impair the national security.

The investigation is still ongoing and the EU is taking part in the hearings, Commissioner Malmström confirmed. But so far the Commission will not take measures “against something that has not happened yet”. In any case, she underlined, “this is for member states to discuss.”

Trade will most likely be on the European Council agenda on Thursday (28 June).

During discussions on restriction measures on steel and aluminium, the EU offered to negotiate a “small agreement to take away all tariffs on industrial goods, including parts”, but only on condition that the EU was excluded from the restrictions on steel and aluminium.  As Washington rejected the offer, the talks are over, Malmström said.

“If we were to take away the tariffs on cars vis a vis the Americans, as we have no trade agreement with them, that falls under the WTO most favoured nation and we would have to take away tariffs on cars for the whole world,” the Commissioner explained. “There is no way I can see the member states agreeing to that.”

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