The White House released the full text, including annexes, of Presidential Proclamation 9704 and Presidential Proclamation 9705 setting across-the-board Section 232 tariffs on aluminum and steel, respectively. As announced March 8 (see 1803080025), tariffs are set at 10 percent on aluminum products and 25 percent on iron and steel products. The new tariff provisions take effect at 12:01 a.m. on March 23.
Section 232 Tariffs
The United States currently maintains a 25% tariff on steel imports and 10% on tariff on aluminum imports under Section 232 of the Trade Expansion Act of 1962. In 2018, the Trump administration imposed Section 232 Tariffs on steel and aluminum imports into the United States, citing national security concerns. The U.S. agreed to lift tariffs on Canada and Mexico after the signing of the United States-Mexico-Canada Agreement (USMCA), and reached deals with the European Union, Japan and other countries to replace the tariffs with quotas for steel and aluminum imports into the U.S.
The White House released the full text, including annexes, of Presidential Proclamation 9704 and Presidential Proclamation 9705 setting across-the-board Section 232 tariffs on aluminum and steel, respectively. The proclamations create new subheadings 9903.85.01 and 9903.80.01 for aluminum and steel products covered by the tariffs, as well as new notes to chapter 99 detailing the scope of the Section 232 actions.
International Trade Today is providing readers with some of the top stories for March 5-9 in case they were missed.
Despite the recent attention on Section 232 tariffs, some expect the effects of the Section 301 investigation started last year (see 1708210024) to eclipse the steel and aluminum import restrictions, panelists said at a Washington International Trade Association event March 13. Wendy Cutler, a former acting deputy U.S. trade representative, said once the White House announces what it's doing to respond to China's intellectual property transgressions, "we won't be talking about steel and aluminum."
Australian Prime Minister Malcolm Turnbull said in a March 12 tweet that President Donald Trump gave a commitment that Australian steel and aluminum will not be subject to tariffs. The path to get an exemption for the European Union, however, looks rocky. Trump tweeted on March 10: "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. Big Deficit. If not, we Tax Cars etc. FAIR!"
President Donald Trump announced that tariffs of 25 percent on steel and 10 percent on aluminum will take effect on March 23, but the tariffs are not going to be as global as he suggested a week ago. Canada and Mexico's exports will not be subject to the tariffs while NAFTA negotiations continue, Trump said, and assuming the U.S. can get a deal "that's fair for our workers, fair for our farmers -- we love our farmers -- fair for our manufacturers," then those countries will be exempted permanently. "I have a feeling we're going to make a deal on NAFTA," he said during a March 8 signing ceremony.
White House Press Secretary Sarah Sanders said that Mexico, Canada and other countries may avoid the soon-to-be-announced tariffs on steel and aluminum. "There are potential carve-outs for Mexico and Canada based on national security, and possibly other countries as well based on that process," she said during a March 7 press briefing. President Donald Trump is still expected to "sign something by the end of the week," she said.
Senate Majority Leader Mitch McConnell broke his silence on steel and aluminum tariffs, which have sparked strong reactions from Republicans in both chambers since the surprise announcement last week (see 1803010029). "There is a lot of concern among Republican senators that this could metastasize into a larger trade war, and many of our members are discussing with the administration just how broad, how sweeping this might be," he said at a news conference March 6. He noted that President Donald Trump has suggested an exemption for Canada and Mexico might be tied to concessions in NAFTA renegotiations. "From a Kentucky point of view, NAFTA's been a big one, we've benefited from it in every way," the senator from Kentucky added. McConnell said that if the tariffs create disruption, "it could send our economy in the wrong direction."
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President Donald Trump tweeted March 5 that he won't exempt Mexico and Canada from steel and aluminum tariffs unless the U.S. gets its way at the NAFTA negotiating table. The tweets came on the last day of round 7 of the NAFTA talks. "NAFTA, which is under renegotiation right now, has been a bad deal for U.S.A. Massive relocation of companies & jobs. Tariffs on Steel and Aluminum will only come off if new & fair NAFTA agreement is signed. Also, Canada must treat our farmers much better. Highly restrictive. Mexico must do much more on stopping drugs from pouring into the U.S. They have not done what needs to be done. Millions of people addicted and dying," Trump wrote.