US and EU Begin Resolving Steel-Related Trade Dispute

[Asia Economy Reporter Changhwan Lee] The United States and the European Union (EU) have begun resolving the trade dispute that started with the imposition of tariffs on European steel and aluminum during the Donald Trump administration.

On the 17th (local time), according to Bloomberg News and others, US Secretary of Commerce Gina Raimondo, USTR Representative Katherine Tai, and EU Executive Vice President for Trade Valdis Dombrovskis issued a joint statement to this effect.

In their joint statement, they announced the start of discussions to address the issue of steel and aluminum overproduction.

The European Commission stated, "Through a video conference last week, we agreed on the need for effective solutions to protect key industries and to find a way to resolve the World Trade Organization (WTO) dispute arising from the US imposing tariffs on European products under Section 232 of the Trade Expansion Act."

Previously, in 2018 during the Donald Trump administration, the US applied Section 232 of the Trade Expansion Act to impose tariffs on steel and aluminum from Europe and Asia, citing national security reasons.

In response, the EU planned to retaliate by increasing tariffs by 50% on $2.8 billion worth of US products, including steel, bourbon whiskey, Harley-Davidson motorcycles, and jeans.

The EU's retaliatory tariffs were scheduled to take effect on the 1st of next month but have been postponed due to this agreement.

Commissioner Dombrovskis explained on Twitter, "The EU and the Joe Biden US administration have agreed to refrain from increasing tariffs on both sides."

President Biden has prioritized strengthening relations with traditional allies and partners, focusing on improving ties with the EU, which had been strained during the Trump era. Notably, the possibility of joint sanctions against China has also drawn attention.

In their statement, both sides said, "The United States and EU member states, as allied and partner market economy democracies, share similar interests in national security and have agreed to cooperate in holding accountable countries that support trade-distorting policies, such as China."