Trump asks for EU’s voluntary exports restrictions on aluminium and steel

The European Union seems to be in a difficult spot, as Donald Trump has asked for EU’s voluntary export restrictions on aluminium and steel for granting permanent exemptions from metal tariffs. Initially, while demanding a permanent relief from the US tariffs, the EU had taken a principal stance that it would not want to breach the WTO rules for international trade. This is now making the situation more critical for the EU to give in to President Trump’s demands without losing face.

On the other hand, Germany is putting pressure on the EU to move away from a trade dispute with the US, fearing that it might take a toll on both.

According to an update from a news agency, Washington and Brussels are working on an informal deal that would cap European steel shipments to the US at 90 per cent of 2017 imports. But in case the deal fails and the tariffs on the European Union become reality, then EU will likely retaliate against the US. As decided previously, it will impose export tariffs on 185 US products.

However, the impact of the EU’s retaliation act on both the US and Europe’s economy are expected to be minimal. European Union’s exports of aluminium and steel to the US account only 0.3 per cent of its worldwide goods exports, representing 0.05 per cent of the EU’s GDP. On the other hand, United States’ exports of those products on the EU’s tariffs list account only 0.1 per cent of its worldwide exports. Only the targeted industries might feel pain.