Section 232 Tariff Truce Likely Between US & EU
Bloomberg reported that US President Mr Joe Biden’s administration is set to announce a truce in a dispute with the European Union over metal tariffs. Under the agreement, the EU will refrain from increasing those tariffs and both sides will engage in a dialogue on steel overcapacity. The European Union had previously proposed to suspend all duties on each other’s products for six months while negotiations on a long-term solution continue.
At issue is a high-profile dispute that started in 2018 under former President Mr Donald Trump, in which the US imposed duties on steel and aluminium in March 2018, using an arcane national-security provision in a 1962 trade law to justify the move. Some countries, including Brazil and South Korea, negotiated deals to avoid the tariff, and Trump dropped the duty for imports from Canada and Mexico. But the tariffs still apply for much of world. The EU has since retaliated and on June 1 was set to double tariffs on a list of American products to 50%.