U.S. Trading Partners Weigh Tariff Responses

U.S. Trading Partners Weigh Tariff Responses – WSJ

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Allies adopt approaches from defiance to conciliation in seeking to avoid Trump’s planned levies

U.S. allies, balancing defiance and conciliation as they seek to avoid President

Donald Trump’s

planned tariffs on steel and aluminum, are walking a line on how much ground to give on other White House trade grievances.

German Chancellor

Angela Merkel

said Monday she wanted to overcome the trade dispute through talks rather than retaliation, striking a more conciliatory tone on Mr. Trump’s plan than has come from European Union officials, who handle trade for Germany and the bloc’s 27 other members.

Mr. Trump, who has accused allies in Europe and around the world of unfair trade practices, said in a tweet Monday that Commerce Secretary

Wilbur Ross

would start talking with EU representatives “about the large Tariffs and Barriers they use against the U.S.A. Not fair to our farmers and manufacturers.”



S. Korea










EU trade spokesman

Enrico Bravo

said contacts at several levels were expected this week but U.S. criteria for exemptions remained uncertain before the tariffs take effect on March 23. EU officials have said they won’t negotiate other trade issues “at gunpoint.”

Mr. Trump has indicated a willingness to drop his planned tariffs of 25% on steel imports and 10% on aluminum if trading partners make concessions on other trade issues.

In a tweet Saturday, Mr. Trump said, “The European Union, wonderful countries who treat the U.S. very badly on trade, are complaining about the tariffs on steel & aluminum. If they drop their horrific barriers & tariffs on U.S. products going in, we will likewise drop ours.” Mr. Trump also reiterated his objective to close America’s trade deficit with the EU: “If not, we Tax Cars etc. FAIR!”

The EU imposes a 10% duty on cars imported from the U.S. and some other countries, while the U.S. duty on cars imported from the EU is 2.5%, under global trade rules set in 1994.

Announcing his plan on Thursday, Mr. Trump exempted Canada and Mexico while the two are renegotiating the North American Free Trade Agreement with the U.S. Mr. Trump on Friday alluded to concessions from Australia in return for an exemption.

Allied leaders, while confirming their strategic alignment with the U.S., pledged not to be cowed by threatened tariffs.

Canadian Foreign Minister

Chrystia Freeland

said her country wouldn’t cave to new or earlier demands from the Trump administration at the Nafta negotiations to maintain the tariff exemption.

“We will not be subject to any type of pressure,” she said Sunday.

Australian Prime Minister

Malcolm Turnbull

also dismissed the idea of concessions. “Nothing of that kind,” he said on Saturday. Mr. Turnbull also suggested that Australia would clinch exemptions from the U.S. and had no intention of joining potential challenges at the World Trade Organization.

At the same time, many allies rely heavily on the U.S. Japan and South Korea depend on the U.S. military for protection and the U.S. market for profits, and both have been conducting two-way talks on trade with Washington since last year.

Germany runs Europe’s largest trade surplus with the U.S. and Ms. Merkel, presenting her new government’s agenda in Berlin, said she welcomed talks between Brussels and Washington.

“Such different views, whether there is a fair situation or not, must be overcome with talks and not, if it can be avoided, with unilateral actions,” Ms. Merkel said.

“If such unilateral actions can’t be prevented, then we will of course consider how to respond reciprocally. But for now, we put emphasis on talks and there will be many opportunities for this.”

The EU has warned that if Washington doesn’t grant the bloc an exemption from the planned tariffs it would impose about $3.5 billion of levies on certain American products, challenge the tariffs at the WTO and enact measures to safeguard European industries from steel and aluminum exports diverted from U.S. markets.

Write to Andrea Thomas at andrea.thomas@wsj.com, Paul Vieira at paul.vieira@wsj.com and David Winning at david.winning@wsj.com

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