Truce between the United States and Europe in their dispute over steel and aluminum

The European Union (EU) and the United States inaugurated, Sunday, October 31, ” a new era “ of their relationship – failing to be able to find the one that prevailed before Donald Trump’s stormy tenure. European Commission President Ursula von der Leyen and US President Joe Biden have announced that they have reached a truce in their steel and aluminum trade dispute, while showing their willingness to forge a global deal on low-carbon production of these materials, with China in their sights.

In graphics: Steel and aluminum, a drop in trade between the United States and Europe

Joe Biden welcomed“A major advance” for the United States and the EU, which will continue to“To be the closest friends and partners”, while Ursula von der Leyen stated that “Trust and communication” between the two partners had been re-established. By suspending this conflict which has poisoned the transatlantic relationship since 2018, Washington and Brussels want to prove the renewed strength of their partnership. In fact, the Europeans had to make heavy concessions to achieve this, a sign that tensions persist.

Too delicate

Europe demanded that the United States reverse the decision – which it denounces as “Illegal” – Donald Trump to impose additional customs duties of 25% on steel and 10% on aluminum imported from the EU. However, a step back was too delicate for Joe Biden, so much “Protectionist sentiment remains strong in the United States”, recalls the economist Jean-Christophe Defraigne, professor at the Catholic University of Louvain and Saint-Louis. The compromise was to maintain these customs duties, but to exempt a certain quantity of them from European imports, in order to allow European industries to regain the “Historical volumes” of their trade with the United States.

Despite this, Europe is still described as a “threat to the national security” of the United States, in the words of Donald Trump.

From the 1is December, they will be able to export up to 4.4 million tonnes of steel per year duty free. Quotas are set at 18,000 tonnes for primary aluminum and 366,000 tonnes for semi-finished products. Washington specifies that only steel and aluminum “Melted and poured” in the EU will benefit from these exemptions. One way of countering the tricks of the Chinese, who treat their materials to a minimum in Europe before exporting them to the United States. In exchange, Brussels will suspend the surtax on American products such as bourbon, Harley Davidson motorcycles or jeans. This agreement prevented an escalation of the trade war, as these taxes were to double in the 1is December.

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Truce between the United States and Europe in their dispute over steel and aluminum