The U.S. and the European Union agreed Monday to begin talks on steel and aluminum supply in a bid to smooth over trade relations and lift tariffs imposed by former President Donald Trump on national security grounds.
The parties said they want to reach a solution by the end of the year that addresses World Trade Organization disputes over tit-for-tat levies and “global excess capacity” from China and elsewhere.
“The distortions that result from this excess capacity pose a serious threat to the market-oriented EU and U.S. steel and aluminum industries and the workers in those industries,” U.S. Trade Representative Katherine Tai, Commerce Secretary Gina M. Raimondo and European Commission Executive Vice President Valdis Dombrovskis said in a joint statement.
The parties “agreed that, as the United States and E.U. Member States are allies and partners, sharing similar national security interests as democratic, market economies, they can partner to promote high standards, address shared concerns, and hold countries like China that support trade-distorting policies to account.”
Mr. Trump imposed a 25% tariff on foreign steel and a 10% tariff on aluminum in 2018 as part of his penchant for using levies to gain an upper hand in trade relations and protect domestic workers.
The moves chagrined allies abroad and free-trade supporters at home and led to disputes before the WTO.
The EU imposed more than $7 billion in retaliatory tariffs in phases but delayed the second batch until June of this year.
Now, the EU says it will hold off completely as the talks unfold.
“In our effort to reboot transatlantic relations, EU will temporarily suspend the increase of its rebalancing measures on U.S. 232 steel & aluminum tariffs,” Mr. Dombrovkis tweeted. “This gives us space to find joint solutions to this dispute & tackle global excess capacity.”