Trump announces steel, aluminum tariffs

By Barry Eitel

SAN FRANCISCO

President Donald Trump said Thursday the United States would implement stiff new tariffs on imported steel and aluminum.

Trump said the new tariffs of 25 percent on imported steel and a 10 percent on aluminum imports would take effect next week.

The “disgraceful” treatment of U.S. steel and aluminum producers by other nations, especially China, helped lead to the decision, Trump said.

"And when it comes to a time when our country can't make aluminum and steel – and somebody said it before and I will tell you – you almost don't have much of a country, because without steel and aluminum, your country is not the same,” he said announcing the new tax.

"We need great steel makers, great aluminum makers for defense."

The Dow Jones industrial average disapproved of the move, plunging nearly 500 points in afternoon trading -- a 2 percent decrease.

Shares of Pennsylvania-based U.S. Steel, the second-largest steel producer in the nation, rose nearly 6 percent to $46.07.

Approximately 90 percent of aluminum used in American manufacturing is imported as well as one-third of steel. Industry groups believe consumers will bear the brunt of the tariffs because of increased prices for items like beer, cars and other objects built of or packaged in metals.

“These proposed tariffs on steel and aluminum imports couldn’t come at a worse time,” said Cody Lusk, CEO of auto industry advocate the American International Automobile Dealers Association, in a statement.

“Auto sales have flattened in recent months, and manufacturers are not prepared to absorb a sharp increase in the cost to build cars and trucks in America. The burden of these tariffs, as always, will be passed on to the American consumer.”

Democrat and Republican politicians also criticized the announcement.

"Let's be clear: The President is proposing a massive tax increase on American families,” Senator Ben Sasse, a Republican, said in a statement shortly after the announcement.

“Protectionism is weak, not strong.”

Reaction also came from Canada where the tariffs will be a blow to that economy, which is the largest exporter of steel and aluminum to the U.S.

In 2017, Canadian exports of steel accounted for 16 percent of the 26.9 metric tons imported by the U.S. The dollar value and amount of aluminum exported Canada’s southern neighbor, however, were not readily available.

Foreign Affairs Minister Chrystia Freeland in a statement called the tariffs “absolutely unacceptable” and that “Canada will take responsive measures to defend its trade interests and workers” if the tariffs are enacted next week.

Freeland also chided the U.S. for the tariffs she said would harm workers in both countries.

“Any restrictions would harm workers, the industry and manufacturers on both sides of the border,” she said. “The steel and aluminum industry is highly integrated and supports critical North American manufacturing supply chains.”

The head of the Canadian arm of the United Steelworkers union, Ken Neumann, said the tariff could “decimate” the steel industry in Canada. He made the remark one day before Trump announced the tariffs.

The tariff announcement takes place as Mexico, Canada and the U.S. are in the seventh round of North American Free Trade Agreement renegotiations this week in Mexico City.

And the European Commission promised “countermeasures” against American goods to “rebalance” trade between Europe and the U.S.

"We strongly regret this step, which appears to represent a blatant intervention to protect US domestic industry and not to be based on any national security justification,” European Commission President Jean-Claude Juncker said in a statement.

*Anadolu Agency correspondent Ata Ufuk Seker in Brussels and Barry Ellsworth in Canada contributed to this report.