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Trump steel tariffs: Trading partners threaten retaliation | Trump steel tariffs: Trading partners threaten retaliation |
(about 3 hours later) | |
The main trading partners of the US have reacted angrily after President Donald Trump announced plans to impose tariffs on steel and aluminium imports. | The main trading partners of the US have reacted angrily after President Donald Trump announced plans to impose tariffs on steel and aluminium imports. |
Canada and the EU said they would bring forward their own countermeasures to the steep new tariffs. | Canada and the EU said they would bring forward their own countermeasures to the steep new tariffs. |
Mexico, China and Brazil have also said they are weighing up retaliatory steps. | Mexico, China and Brazil have also said they are weighing up retaliatory steps. |
Mr Trump tweeted that the US had been "decimated by unfair trade and bad policy". He said steel imports would face a 25% tariff and aluminium 10%. | Mr Trump tweeted that the US had been "decimated by unfair trade and bad policy". He said steel imports would face a 25% tariff and aluminium 10%. |
However, critics argue that the tariffs would fail to protect American jobs and would ultimately put up prices for consumers. | However, critics argue that the tariffs would fail to protect American jobs and would ultimately put up prices for consumers. |
The news sent shares in Asia down on Friday, with Japan's benchmark Nikkei 225 losing more than 2% by mid-morning. | The news sent shares in Asia down on Friday, with Japan's benchmark Nikkei 225 losing more than 2% by mid-morning. |
Shares in Japan's car-making giant Toyota were down more than 2% and Nippon Steel stocks down more than 4%. | Shares in Japan's car-making giant Toyota were down more than 2% and Nippon Steel stocks down more than 4%. |
Toyota said the US decision would "adversely impact automakers, the automotive supplier community and consumers". | Toyota said the US decision would "adversely impact automakers, the automotive supplier community and consumers". |
President Trump ordered an investigation into the industry last April under a clause of a 1962 law, which grants the White House authority to restrict imports in the face of a national security threat. | |
The Commerce Department report found that imports were harming the domestic steel and aluminium industries, and could affect the defence industry, the Washington Post reported. | |
The decision on imposing tariffs rests with the President and does not need Congressional approval. | |
What has the political reaction been? | What has the political reaction been? |
European Commission President Jean-Claude Juncker said the tariffs would put thousands of European jobs at risk. | European Commission President Jean-Claude Juncker said the tariffs would put thousands of European jobs at risk. |
"We will not sit idly while our industry is hit with unfair measures," he said. "The EU will react firmly and commensurately to defend our interests." | "We will not sit idly while our industry is hit with unfair measures," he said. "The EU will react firmly and commensurately to defend our interests." |
In Canada, the largest supplier of steel and aluminium to the US, trade minister Francois-Philippe Champagne said any tariffs would be "unacceptable". | In Canada, the largest supplier of steel and aluminium to the US, trade minister Francois-Philippe Champagne said any tariffs would be "unacceptable". |
Minister of Foreign Affairs Chrystia Freeland said Canada would take "responsive measures" if restrictions were imposed but did not give details. | Minister of Foreign Affairs Chrystia Freeland said Canada would take "responsive measures" if restrictions were imposed but did not give details. |
In other reaction: | In other reaction: |
How has China reacted? | How has China reacted? |
The country which produces more than half the world's steel gave no immediate official response but there had already been indications it would consider some sort of retaliation. | The country which produces more than half the world's steel gave no immediate official response but there had already been indications it would consider some sort of retaliation. |
Li Xinchuang, vice-secretary-general of the China Iron and Steel Association, said the impact on China would not be big, adding: "Nothing can be done about Trump. We are already numb to him." | Li Xinchuang, vice-secretary-general of the China Iron and Steel Association, said the impact on China would not be big, adding: "Nothing can be done about Trump. We are already numb to him." |
Little Chinese steel directly reaches US ports, Reuters news agency notes, because of previous anti-dumping duties, designed to prevent countries from selling their products at prices deemed unfairly low. | Little Chinese steel directly reaches US ports, Reuters news agency notes, because of previous anti-dumping duties, designed to prevent countries from selling their products at prices deemed unfairly low. |
But US steel industry executives say Chinese steel is still widely shipped to the US through third countries. | But US steel industry executives say Chinese steel is still widely shipped to the US through third countries. |
President Xi Jinping's top economic adviser, Liu He, met the Trump administration on Thursday for "frank and constructive" talks, a White House official said. | President Xi Jinping's top economic adviser, Liu He, met the Trump administration on Thursday for "frank and constructive" talks, a White House official said. |
How did other markets respond? | How did other markets respond? |
In South Korea, America's third largest source of steel, shares in steelmaking giant Posco were down more than 3.5%. The benchmark Kospi index was down close to 1.5%. | In South Korea, America's third largest source of steel, shares in steelmaking giant Posco were down more than 3.5%. The benchmark Kospi index was down close to 1.5%. |
In China, investors seemed less concerned about the new tariffs. Hong Kong's Hang Seng index was down 1.7%, while the Shanghai Composite was down 0.7%. | In China, investors seemed less concerned about the new tariffs. Hong Kong's Hang Seng index was down 1.7%, while the Shanghai Composite was down 0.7%. |
In Australia, the benchmark S&P/ASX 200 index had lost 1% by midday trade, dragged down by losses in commodities. Stocks in mining giant BHP Billiton were down more than 1.5%. | In Australia, the benchmark S&P/ASX 200 index had lost 1% by midday trade, dragged down by losses in commodities. Stocks in mining giant BHP Billiton were down more than 1.5%. |
What did Trump say? | What did Trump say? |
Mr Trump pledged to rebuild the US steel and aluminium industries which he said had suffered "disgraceful" treatment from other countries, in particular China, for decades. | Mr Trump pledged to rebuild the US steel and aluminium industries which he said had suffered "disgraceful" treatment from other countries, in particular China, for decades. |
"When our country can't make aluminium and steel... you almost don't have much of a country," he said. | "When our country can't make aluminium and steel... you almost don't have much of a country," he said. |
"We need great steel makers, great aluminium makers for defence." | "We need great steel makers, great aluminium makers for defence." |
Mr Trump's announcement was slightly delayed amid reports of disagreement among his aides. | Mr Trump's announcement was slightly delayed amid reports of disagreement among his aides. |
More than a dozen metals executives, including representatives from US Steel Corp and Arcelor Mittal, stood alongside him as he made the announcement. | More than a dozen metals executives, including representatives from US Steel Corp and Arcelor Mittal, stood alongside him as he made the announcement. |
During his presidential campaign, Mr Trump said that foreign countries were "dumping vast amounts of steel all over the United States, which essentially is killing our steelworkers and steel companies". | During his presidential campaign, Mr Trump said that foreign countries were "dumping vast amounts of steel all over the United States, which essentially is killing our steelworkers and steel companies". |
Since taking office he has said cheap imports from China are harming the viability of industry in the US. | Since taking office he has said cheap imports from China are harming the viability of industry in the US. |
What shape is the US steel industry in? | What shape is the US steel industry in? |
The US imports four times more steel than it exports and is reliant on steel from more than 100 nations. | The US imports four times more steel than it exports and is reliant on steel from more than 100 nations. |
The US Department of Energy says the steel industry is recovering after a slump following the 2008 financial crisis. | The US Department of Energy says the steel industry is recovering after a slump following the 2008 financial crisis. |
But it is an industry significantly weaker than it was at the turn of the millennium. In 2000 the US produced 112m tons of steel - a figure that had fallen to 86.5m tons in 2016. | But it is an industry significantly weaker than it was at the turn of the millennium. In 2000 the US produced 112m tons of steel - a figure that had fallen to 86.5m tons in 2016. |
In 2000, 135,000 people were employed in the industry - a figure that fell to 83,600 in 2016. | In 2000, 135,000 people were employed in the industry - a figure that fell to 83,600 in 2016. |