The US commerce secretary has rebuffed Europe’s demands for a permanent exemption from new metals tariffs, calling on the EU to follow China’s example in the latest sign of Washington’s willingness to upset long-term alliances. 

In blunt comments in Paris on Wednesday, Wilbur Ross indicated that the Trump administration would begin imposing tariffs on imports of European steel and aluminium from June 1 despite a last-minute effort by the EU to avoid them. 

Writing in the Financial Times, he also lashed out at the EU’s new data privacy rules, calling them new trade barriers that would damage US companies. 

The comments came ahead of a visit to China for negotiations in which the US is pressing for Beijing to agree to long-term contracts for agriculture and energy purchases that would probably hurt exporters in the EU and other allies. 

Addressing an annual OECD trade forum in Paris, Mr Ross pointed to those talks with China as evidence that it was possible to engage with the Trump administration while being subject to tariffs.

“There can be negotiations with or without tariffs, it’s not that you can’t talk with tariffs,” Mr Ross said. “China is an interesting case in point. They are paying the tariffs, they came into effect in March and they haven’t used this as an excuse not to talk. It’s only the EU insisting we can’t negotiate if there are tariffs.”

The Trump administration has been trying to increase pressure on the EU to force it to the negotiating table and make concessions such as lowering a 10 per cent car tariff in exchange for an exemption from the steel tariffs.

It also wants the EU to agree to a quota that would limit European steel and aluminium exports to the US as part of what Washington insists is a global move by it to raise pressure on Beijing to stop flooding global markets with cheap metals. 

But Mr Trump and his aides have become increasingly frustrated with the EU’s insistence that it be exempted from the new national security tariffs on steel and aluminium before any negotiations can begin.

Officials in Washington privately liken that to Europe demanding the US give away “a big hammer” as the cost of entry to talks that could lead nowhere. 

The administration has also remained defiant on its broader plans for new tariffs, launching an investigation last week into whether car imports present a threat to US national security, something it argues is derived from broader economic security. The EU would also be a major target for any such tariffs. 

Mr Ross insisted that the benefit to the US economy of tariffs outweighed the cost increases that some industries were facing as a result of the more expensive imports. 

“The sky has not fallen on the US and it won’t,” Mr Ross said. “But it creates a lot of jobs in steel and aluminium, that’s real. I don’t see car companies closing up, I don’t see can companies closing up.”

Washington’s determination to impose trade tariffs on some long-time allies has dismayed the EU.

Cecilia Malmstrom, the EU’s trade commissioner, on Wednesday pressed for clarity from US officials on what sort of capping mechanism they plan to apply when the EU’s temporary exemption from the steel and aluminium tariffs expires on Friday. 

In a speech at the OECD, French president Emmanuel Macron urged world leaders including the US to devise a “road map” to “transform” the World Trade Organization before the G20 meeting in Buenos Aires in November, while standing by a WTO dispute settlement framework that has been under assault from the US.

Mr Macron invoked the rise of nationalism in the 1930s to make the case against unilateral actions.

“We can’t be the modern-day sleepwalkers,” the president said. “One should not respond to dysfunction with nationalist retrenchment because these responses deepen the crisis and the world’s unbalances.”

Earlier, an Elysée adviser had warned that the EU was ready to retaliate if the US decided to inflict the metals duties on its European allies. “We won’t try to augment tensions, but we will respond,” the aide said.

Speaking to members of the European Parliament on Tuesday, Ms Malmstrom acknowledged that it was no longer realistic to hope for a full carve-out from the 25 per cent tariff on steel and 10 per cent tariff on aluminium. Instead, she said the EU should prepare for a cap on exports. 

The EU trade chief said it was still unclear whether the US would opt for a “hard” limit on the volume of European steel and aluminium allowed into its market, or instead grant the EU a “soft” quota above which the punitive tariffs would apply.

EU leaders earlier this month reiterated their call for a full exemption from the measures, which they slammed as a naked act of US protectionism.

They have also approved a list of US products as targets for retaliation including Bourbon whiskey, Harley-Davidson motorcycles and jeans. 



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