The US and the EU have agreed to ease tariffs on billions of dollars of steel and aluminium products in a bid to resolve a trade dispute that has hung over transatlantic relations since the Trump administration.
“We have agreed with the US to pause our steel and aluminium (232) trade dispute and launch co-operation on a Global Arrangement on Sustainable Steel and Aluminium,” said Valdis Dombrovskis, EU trade commissioner. He said Joe Biden, US president, and Ursula von der Leyen, EU Commission president, would give more details on Sunday.
The Biden administration and the EU have been negotiating a settlement on steel and aluminium trade for months, after former president Donald Trump imposed tariffs on metals products under little-used national security legislation.
The agreement puts in place a system of tariff-rate quotas, which will allow exports of metals between the EU and the US with lower levies up to a certain volume.
The EU was set to increase retaliatory tariffs on US goods from December 1, having paused action in May to allow time for negotiations.
The deal was announced on Saturday during the G20 summit in Rome, in an arrangement US officials said would reduce global carbon emissions and Chinese overcapacity in the sector, while easing supply chain bottlenecks in the the metals industry.
US trade representative Katherine Tai said that in addition to the EU eliminating retaliatory tariffs against the US, “we have agreed to suspend the WTO disputes against each other related to the 232 disputes”.
“Going forward, the US and the EU will analyse the volume of steel and aluminium imports from the EU each year, share information and best practices on trade remedies, and ensure that products from non-market economies do not benefit from the arrangement,” she said.
Tai also told reporters that the agreement “also addresses global overcapacity from China and toughens enforcement mechanism to prevent leakage of Chinese and other unfairly traded steel and aluminium into the US market”.
The EU was under huge pressure from steelmakers to get the tariffs lifted. However, how warmly they will welcome the deal will depend on how much metal the US is prepared to allow in tariff-free.
The US bought around 3.2m tonnes annually from the EU before the tariffs and that has dropped by a third since.
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