America's partners are on the clock. They have to come up with trade deals that are acceptable to Trump or they'll be slapped with the metal levies too.
The countries exempt from Donald Trump’s steel and aluminium tariffs are expected to hurriedly offer trade agreements that are more to America’s liking, otherwise they’ll be slapped with the import duties too.
Australia, Europe, South Korea, Canada, Mexico, Argentina and Brazil have all been granted temporary exemption from the steel (25%) and aluminium (10%) levies until May 1, but on Thursday US trade representative Robert Lighthizer and Trump’s policy adviser Peter Navarro explained the rider attached to the agreement.
“Here’s what’s going to happen,” Navarro told CNN.
“They’re temporary exemptions conditioned on the ability of these countries to come to the table and give us more fair and reciprocal trade.”
Navarro also revealed that the exempt countries would also have quotas imposed on them to ensure they do not become trans-shipment points for trade partners like China who are not exempt.
“This is an important thing,” Navarro continued.
“Every country that is not facing tariffs that we are going to negotiate with will face quotas so that we protect our aluminum and steel industries.
“For all countries there has to be a quota.
“If you don’t put a quota on then any country that can do whatever they want will become a trans-shipment point for any other country.”
China responded in kind early on Friday by announcing a list of US goods, including pork, apples and steel pipe, it said may be hit with higher import duties.
New tariffs levelled at China
Trump’s renewed pressure on his closest allies coincides with his motion to hit China with further tariffs on about 1300 imported product lines worth $50 billion.
The decision follows a seven-month investigation into the intellectual property theft.
According to Everett Eissenstat, the deputy director of the National Economic Council for international economic affairs, the investigation concluded that China has stolen or coerced US companies into turning over their intellectual property through a series of state-run structural manoeuvres, including its requirement that foreign companies partner with Chinese companies to access the Chinese market.
“We have a tremendous intellectual property theft problem,” Trump said. “It’s going to make us a much stronger, much richer nation.”
The latest measures will do nothing to ease tensions between the two superpowers, who have both indicated they’ve got no intention of backing down in the event of a trade war.