US allies hit back at Washington’s steel, aluminum tariffs

A red-hot steel plate passes through a press at the ArcelorMittal steel plant in Ghent, Belgium. Picture: REUTERS/Yves Herman/File Photo

WASHINGTON/PARIS – Canada and Mexico retaliated against the United State’s decision on Thursday to impose tariffs on steel and aluminum imports and the European Union had its own reprisals ready to go, reigniting investor fears of a global trade war.

The tariffs, announced by US Commerce Secretary Wilbur Ross in a telephone briefing on Thursday, ended months of uncertainty about potential exemptions and suggested a hardening of the Trump administration’s approach to trade negotiations.

The measures, touted by President Donald Trump in March, drew condemnation from Republican lawmakers and the country’s main business lobbying group and sent a chill through financial markets.

The Dow Jones Industrial Average lost 1 per cent and the S&P 500 shed around 0.66 per cent. Shares of industrial heavyweights Boeing fell 1.7 per cent and Caterpillar 2.2 per cent.

A 25 percent tariff on steel imports and 10 per cent tariff on aluminum imports will be imposed on the EU, Canada and Mexico from midnight (0400 GMT on Friday), Ross told reporters.

“We look forward to continued negotiations, both with Canada and Mexico on the one hand, and with the European Commission on the other hand, because there are other issues that we also need to get resolved,” he said.