ROME – The US and the European Union have buried the hatchet in their steel and aluminum trade dispute and say they’ll draft a global accord over the next two years that must better arm both sides against oversupply from China.
In the margin of a G20 summit in Rome on Oct. 31, US President Joe Biden spoke of a “major breakthrough” announcing the immediate lifting of tariffs on EU steel and aluminum. His predecessor Donald Trump imposed these levies — 25% on steel, 10% on aluminum — as part of a spat between Washington and China at which the EU was a mere bystander.
A global deal is meant to prevent dumping by China and others. It would also result in using less carbon in steel and aluminum and address overcapacity. A global deal will be open to any country willing to embrace sound market rules, EU officials said.
The Brussels-based European Boating Industry said ending tariffs means the EU’s retaliatory tariffs on U.S. products like whiskey, recreational boats, jeans, Harley-Davidson motorcycles etc. will also be dropped. ” We are delighted that after much pressure and lobbying work … this trade dispute seems to have been resolved,” said EBI General Secretary Phillip Easthill.
In May, the EU held off on raising tariffs on US imports to give negotiations a chance. Europe always argued China’s overcapacity caused the disruption of transatlantic trade in steel and aluminum.
The US and EU have paused the reset button “due to our shared willingness to forge a new trade agenda,” said EU Trade Commissioner Valdis Dombrovskis. “EU exporters of steel and aluminum can once again ship their products without undue barriers to US customers, and transatlantic trade can return to pre-tariff levels.”
Dombrovskis called 2021 “a landmark year for transatlantic relations” that took a hit under the Trump administration that unabashedly put US interests first. Under Biden, the EU and US have also grounded a years-old Airbus-Boeing dispute and launched a joint panel to draft new trade and technology rules and standards.