President Donald Trump is planning to impose hefty tariffs on imported steel and aluminum, saying U.S. producers needed protection from countries like China but sparking fears of a trade war.
Trump’s announcement Thursday was, as BBC News reports, a victory for the steel industry. He said duties of 25% on steel imports and 10% on aluminum would be formally announced next week.
U.S. steel production has declined from 112 million tons in 2000 to 86.5 million in 2016. “We’re going to build our steel industry back and our aluminum industry back,” Trump said.
Those industries, he complained, had suffered “disgraceful” treatment from other countries, in particular China, for decades. “When it comes to a time where our country can’t make aluminum and steel … you almost don’t have much of a country,” he added.
But the plan drew rebukes not only from foreign trading partners, but also from U.S. manufacturers of products made with steel and aluminum and Republicans in Congress who are concerned the tariffs will increase prices for consumers.
“Let’s be clear: The President is proposing a massive tax increase on American families,” Sen. Ben Sasse (R-Neb.) said in a statement.
“Trump believes the tariffs will safeguard American jobs, but many economists say the impact of price increases for users of steel and aluminum, such as the auto and oil industries, will destroy more jobs than curbs on imports create,” Reuters noted.
Fears of retaliation were also expressed, with Sen. Pat Roberts (R-Kan.), who chairs the chamber’s agriculture committee, warning that U.S. farm exports could be penalized by steel-exporting countries. “Agriculture is the number one target. I think this is terribly counterproductive for the agriculture economy,” he said.
The tariffs would not directly hit China that hard since it only supplies 2% of U.S. demand for steel. Canada is by far the largest steel exporter, supplying 16% of U.S. demand, followed by Brazil and South Korea.
“Should restrictions be imposed on Canadian steel and aluminum products, Canada will take responsive measures to defend its trade interests and workers,” the country’s foreign affairs minister, Chrystia Freeland, said.