Fears of a trade war between the U. S. and some of its closest allies were averted.
Fears of a trade war between the U. S. and some of its closest allies were averted as President Trump exempted a string of countries from metals tariffs.
The President’s announcement earlier this month that he would slap a 25% duty on steel and 10% on aluminum sparked worries around the world about its economic impact.
Trump had also threatened more tariffs in a war of words with European Union that many feared would escalate into economic blows, with EU also promising retaliations against billions of dollars of American products.
The White House, which had pegged national security as the reason for the tariffs, late Thursday night said that the EU as well as other major steel and aluminum exporters such as Brazil would be exempt.
It said that discussions would be held to find “satisfactory alternative means to address the threatened impairment to the national security» with Australia, Argentina, Brazil, Canada, the EU, Mexico and South Korea.
Japan was noticeably absent from the list.
EU Trade Commissioner Cecilia Malmstrom, optimistic about an exemption on Thursday after discussion with Commerce Secretary Wilbur Ross, said that she did not know what measures a working group would take.
Peter Navaroo, a Trump trade adviser, told CNN on Thursday that quotas on the amount of steel and alumnium sent to the U. S. would be part of the deals for countries with exemptions.
The reprieve many of the top exporters of steel and aluminum to the U. S., with America’s neighbor to the north number one in both categories.
South Korea, Brazil and Mexico are Nos. 2,3, and 4 for steel, so the most affected steel imports will come from Russia, which is not exempt.
Russia is also second for aluminum exports, and will face tariffs along with other top producers in the United Arab Emirates and China.
The Dow Jones dipped hundreds of points on Thursday over fears about Trump’s wider trade antagonism towards China, which could see roughly $50 billion worth of goods tariffed.
