France’s finance and economy minister, Bruno Le Maire, has said that Europe does not want to enter into “any type of trade war” with the United States due to that country’s Section 232 import tariffs, but will take the necessary steps to defend itself.
“The answer [in the fight against global steel] overcapacity is not protectionism,” Le Maire added, calling for a strong and united response from the European Commission (EC) and European nations against the US import tariffs that were announced late last week.
“It is more crucial than ever that governments act decisively to address the root causes of global excess capacity,” Eurofer president Geert Van Poelevoorde said.
“This includes the elimination of capacity and market-distorting subsidies and government support measures worldwide, pursued in the framework of the Global Forum on Steel Excess Capacity,” he added.
On March 8, US President Donald Trump set blanket tariffs of 25% on steel imports and 10% on aluminium imports. But he excluded the US’ fellow members of the North American Free Trade Agreement (Nafta) - Canada and Mexico.
Following the announcement of the trade measures, Eurofer has condemned the decision as being “damaging and counterproductive for both the US and EU economies.”
And earlier last week, the EC announced a three-pronged approach to the US tariffs and said that sufficient and swift measures will be taken to safeguard the interests and jobs of the EU steel sector as a response to Section 232 actions.
“It is important to stress that the steel industry is not seeking anything more than free and fair, rules-based trade,” Van Poelevoorde said.
Whatever the measures presented by the EC are, “they have to be fast and to work, but under WTO [World Trade Organization] rules,” he added. “The Commission is analyzing the measures that best fit with WTO rules.”
Eurofer is seriously concerned about the potentially “disastrous” redirection of steel export volumes previously destined for the US.
The association estimates that at least half of the 26 million tonnes per year of steel imported by the US – or 13 million tonnes – will be redirected, with Europe expected to receive the majority of this volume because it is “an open market.”
In 2017, Europe’s steel import levels rose to 40 million tonnes, according to the group.