The European Union and the United States have jointly decided to extend their trade truce concerning aluminum and steel, marking a significant stride in economic collaboration. This move is integral to the efforts underway to establish a Global Arrangement on Sustainable Steel and Aluminum (GSA).
The European Union has extended its suspension of rebalancing tariffs on US imports. Originally implemented as a counter to the US Section 232 tariffs on steel and aluminum set during the Trump era, this suspension, is now set to last until March 31, 2025.
Parallel to this, the United States has expanded the number of EU exporters who will be exempt from these tariffs. This decision strengthens the trade bond between two of the world’s largest economies.
Katherine Tai, the US Trade Representative, emphasized the intricate and vital nature of these talks in her latest statement. She pointed out the US’s dedication to forging a partnership with the EU, aiming to establish an agreement that encourages fair and sustainable production and trade in the steel and aluminum sectors. This aligns with broader objectives to confront global economic and environmental challenges.
The European Union is equally engaged in this process, aiming to secure its legal interests while working towards abolishing US 232 tariffs on its exports. The focus is on addressing the global excess capacity and promoting the decarbonization of these industries. The prolonged suspension of tariffs offers the needed framework and time to iron out the remaining issues in the GSA discussions.
This initiative is a continuation of actions that began in 2018, following the US’s introduction of tariffs on European steel and aluminum exports worth 6.4 billion euros. The EU’s retaliatory tariffs on US goods, totaling 2.8 billion euros, were put on hold in 2022, facilitating a collaborative approach towards a long-term resolution through the GSA. The US adjusted its strategy, adopting a quota-based tariff system, which allows specific quantities of EU steel and aluminum to enter the US market without tariffs.
2022 trade data underscores the extent of this cooperation. The European Union exported 3.8 million metric tons of steel to the US, with 1.7 million metric tons enjoying tariff-free status under the US 232 tariff rate quotas. As for aluminum, the EU sent 289,000 metric tons to the US, with 146,000 metric tons benefiting from the duty-free arrangement.
The ongoing negotiations and the trade truce extension are clear indicators of a strong and evolving partnership between the EU and the US, reflecting a mutual commitment to sustainable trade and economic collaboration.
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