US President Donald Trump said on Thursday that he will impose hefty tariffs on imported steel and aluminum, throwing up the prospect of retaliatory moves by key trading partners such as Canada, Brazil, China and the European Union.
Trump said the duties of 25 percent on steel and 10 percent on aluminum will be formally announced next week as the government seeks to protect American manufacturers, Reuters reports.
“We’re going to build our steel industry back and our aluminum industry back,” he said.
News of the tariffs drove the share prices of US domestic steel and aluminum makers sharply higher, but sent the broader equity markets down due to worries of a potential global trade war.
The tariffs plan was sharply criticized by some senior Republican legislators as well as industries such as autos and oil which will see a rise in input costs.
There is also a concern that US farm exports could be hit hard due to potential retaliatory moves by steel-exporting countries.
“Every time you do this, you get a retaliation. Agriculture is the number one target. I think this is terribly counterproductive for the agriculture economy,” said Senator Pat Roberts.
China has already threatened to curb imports of US soybeans, while the EU has said it will consider action as well.
Canada supplies 16 percent of US demand for steel, and is by far the top exporter to the nation followed by Brazil and South Korea. China accounts for 2 percent US steel imports.
“Should restrictions be imposed on Canadian steel and aluminum products, Canada will take responsive measures to defend its trade interests and workers,” Canada’s Foreign Affairs Minister Chrystia Freeland said in a statement.
Brazil’s industry ministry said the country will consider taking action on its own over the tariffs or in concert with other nations.
Asked whether there would be exemptions for any countries, White House spokeswoman Sarah Sanders said she would not get into any details ahead of next week’s announcement.
She said the tariffs were still being finalized.
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