Washington, United States — Major US trading partners announced countermeasures Wednesday after Donald Trump’s blanket steel and aluminum tariffs took effect, prompting the president to vow further action.
The steep 25-percent levies came into place after midnight with no exemptions despite countries’ efforts to avert them, in a step up from fresh duties Trump already imposed on Canada, Mexico and China since returning to the White House.
The European Commission swiftly unveiled retaliation starting in April, while Canada announced additional tariffs on some US goods and China vowed “all necessary measures” in response — as Washington edged toward an all-out trade war with allies and competitors alike.
The European Commission will implement a series of countermeasures from April 1 in response to Washington’s “unjustified trade restrictions,” with chief Ursula von der Leyen saying the retaliation was “strong but proportionate.”
Trump told reporters Wednesday that Washington would “of course” strike back.
“We’ve been abused for a long time and we will be abused no longer,” he said.
Canada, which is heavily exposed to the US steel and aluminum levies, announced additional tariffs of CAN$29.8 billion ($20.7 billion) on US goods, coming into force Thursday.
These will hit steel products, aluminum, and goods ranging from computers to sports equipment, said Canadian finance minister Dominic LeBlanc.
But Canada’s incoming prime minister Mark Carney later said that he was ready to negotiate directly with Trump a renewed trade accord to avoid further economic tussling.
His country supplied about half of US aluminum imports and 20 percent of its steel imports, according to a recent note by EY chief economist Gregory Daco.
Besides Canada, Brazil and Mexico are also key US suppliers of steel, while the United Arab Emirates and South Korea are among the major providers of aluminum.
Wednesday’s levies stack atop earlier ones, meaning some Canadian and Mexico steel and aluminum products could face higher tariff rates unless they comply with the US-Mexico-Canada Agreement (USMCA), making them eligible for a temporary reprieve.
‘Enough war’ –
US Trade Representative Jamieson Greer criticized the EU’s promises of retaliation, calling the bloc’s economic policies “out of step with reality” while blaming it for failing to help address global excess capacity.
“The EU’s punitive action completely disregards the national security imperatives of the United States –- and indeed international security,” Greer said.
This came shortly after EU Council chief Antonio Costa called on Washington to de-escalate the situation and enter dialogue.
“I think we have enough war in the world, we need to stop the wars we have and not create a trade war,” Costa said.
German Chancellor Olaf Scholz, head of Europe’s largest and heavily export-oriented economy, condemned Washington’s moves as “wrong” and warned of increased inflation.
Beijing’s foreign ministry said “there are no winners in trade wars.”
China is the world’s leading steel manufacturer, although not a major exporter of the product to the United States.
Trump’s steel and aluminum tariffs will likely balloon costs of producing goods from home appliances to automobiles and cans used for drinks, threatening to raise consumer prices down the road, experts say.
Auto manufacturing and construction are among the biggest users of steel in the country, noted Cato Institute research fellow Clark Packard.
‘Massive uncertainty’ –
Uncertainty over Trump’s trade plans and worries that they could tip the world’s biggest economy into a recession have roiled financial markets. Major Wall Street indexes tumbled for two days before regaining some ground.
Markets in Asia, including Hong Kong and Shanghai, were down on Wednesday.
Even before the latest US tariffs took effect, manufacturers moved to find cost-effective domestic suppliers.
The mere threat of protectionism, said the Cato Institute’s Packard, has allowed US steel and aluminum firms to raise their prices.
“It’s creating massive amounts of uncertainty,” he added.
Trump also targeted both metals in his first presidency.
He has promised further “reciprocal tariffs” from April 2 to tackle what Washington considers unfair behavior.
The lack of exemptions Wednesday came despite US partners, including Australia and Japan, pushing for exclusions.
Tokyo expressed regret it had not succeeded while Australian Prime Minister Anthony Albanese called the tariffs unjustified. Both Canberra and London stopped short of retaliation.
