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Germany calls for 'permanent exemption' from Trump tariffs

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Germany calls for 'permanent exemption' from Trump tariffs
steel worker inspects the steel quality at the blast furnace 8 at ThyssenKrupp's plant in Duisburg. Photo: Roland Weihrauch/dpa
09:48 CEST+02:00
Germany on Tuesday called for a "permanent exemption" on steel and aluminium tariffs, after the US decided to postpone a decision on the issue.
"The German government has taken note" of the decision by US President Donald Trump to hold off on imposing controversial tariffs on steel and aluminium from the EU, Canada and Mexico, a government spokeswoman said. 
 
But Germany "is still waiting for a permanent exemption" from the tariffs and wants the European Commission to "continue dialogue with the United States". 
 
Germany's call came as the European Union accused the United States of prolonging  "market uncertainty" with its decision to hold off on imposing the controversial tariffs.
 
The 25 percent tariffs on steel and 10 percent duties on aluminium -- a key tenet of US President Donald Trump's "America first" approach to worldwide trade -- were due to go into effect on Tuesday. 
 
But after renewed fears of a trade war spooked Wall Street, Trump said he was holding off the levies, offering a 30-day reprieve to Canada, Mexico and the EU. 
   
The European Commission echoed Germany's call, saying all EU nations should be permanently excluded from the punishing tariffs. 
   
"The US decision prolongs market uncertainty, which is already affecting business decisions," the commission, the EU's executive arm, said in a statement.
   
Europe had lined up its own punitive tariffs on American imports, including iconic items like Harley-Davidson motorbikes, blue jeans and bourbon whiskey -- but for now, instead, negotiations will continue.
   
Britain, the EU's second-largest economy, welcomed Trump's "positive" decision but warned against further protectionist measures from the White House. 
   
"We remain concerned about the impact of these tariffs on global trade and will continue to work with the EU on a multilateral solution to the global problem of overcapacity, as well as to manage the impact on domestic markets," a government statement said. 
   
Trump on Monday said the "necessary and appropriate means to address the threat to the national security" posed by the metal imports is to "continue these discussions and to extend the temporary exemption of these countries."
   
The US also announced it had finalised a trade deal with South Korea, which includes several concessions made by Seoul, including extended tariffs on pick-up trucks and a quota on its steel exports.
   
Washington has "agreements in principle" with Argentina, Australia and Brazil, "the details of which will be finalised shortly," a White House statement said.
   
"In all of these negotiations, the administration is focused on quotas that will restrain imports, prevent transshipment, and protect the national security."
   
The Trump administration has told trading partners they must make concessions, but the EU has insisted it will not negotiate without first obtaining a permanent exemption.
   
Extensions for Canada and Mexico had been expected, as Mexico City, Ottawa and Washington work on revamping the North American Free Trade Agreement. Canada exported over $12 billion of steel and aluminium to the United States in 2017, with another $3 billion from Mexico.
   
But an extension for the EU was less of a foregone conclusion.
 
'Won't negotiate under threat'
 
The EU's three largest economies -- Britain, France and Germany -- held crisis talks on Sunday and the French presidency said afterwards they had agreed "the EU must be ready to act" if Washington presses ahead with the tariffs.
   
In a strident statement reacting to the 30-day extension, the EU's executive arm said it was willing to continue dialogue but pointedly warned: "We will not negotiate under threat."
   
"Any future transatlantic work programme has to be balanced and mutually beneficial," it said.
   
Last year the EU exported over $7.7 billion of steel and aluminium to the US market. 
   
London's benchmark FTSE 100 index added 0.1 percent to stand at 7,512.94 points at Tuesday's opening, amid May Day holiday closures in Frankfurt and Paris.
 
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