Trump sets tariff on steel, aluminium imports, provokes global trade war
US President Donald Trump on Friday signed two proclamations that impose 25 per cent tariff on imported steel and 10 per cent on aluminium, a move that is likely to start a global trade war. The contentious tariffs come into effect in 15 days. Though primarily targeted at the massive steel and aluminium dumping by China, only two countries Canada and Mexico have been exempted from the new import tariff, that too till the time the North America Free Trade Agreement (NAFTA) negotiations are complete. Other countries would have to negotiate with US Trade Representatives (USTR) if they want exemptions from the steel and aluminium import tariff, Trump said as he vowed to slap "reciprocal tariffs" on countries like China and India if they do not match America's tariff.
Trump signed the proclamations in presence of steel workers from Pennsylvania, Vice President Mike Pence, Treasury Secretary Steven Mnuchin, Commerce Secretary Wilbur Ross, United States Trade Representative Robert E Lighthizer and economist Peter Navarro, architect of his steel and aluminium policy. Meanwhile, 11 countries including Japan and Canada signed a landmark Asia-Pacific trade agreement without the United States on Thursday in what one minister called a powerful signal against protectionism and trade wars. The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) will reduce tariffs in countries that together amount to more than 13 per cent of the global economy - a total of $10 trillion in gross domestic product. With the United States, it would have represented 40 per cent. Reiterating that countries including America's "friends and allies" have been fleecing the US economy and taking away jobs for decades, Trump pledged to impose "reciprocal tax". "We're going to be doing a reciprocal tax programme at some point so that if China is going to charge us 25 per cent or if India is going to charge us 75 per cent and we charge them nothing. They are 50, they are 75 or they are 25, we are going to be doing the same numbers. It's called reciprocal. It's a mirror of tags. So they charge us 50, we would charge them 50," Trump said in his remarks before signing the two proclamations. The US President said the stage for the imposition of reciprocal tax has been set in the first year of his administration. "They will charge us 50, we charge them nothing. Doesn't work. So that's called a reciprocal tax ... mirror attacks. We will be going to be doing a lot of them," Trump said. "American companies have not been treated fairly and some American companies frankly have taken advantage of it and gone to other countries and developed in Mexico, massive automobile plants, taking our jobs away and taking our companies down to Mexico to make the cars and then they send them right across the border without tax, without anything," he said. Trump said a strong steel and aluminium industry are vital to US national security.
ARTICLE SOURCE- BUSINESS STANDARD.