Politicians, industry, and unions in Europe and Britain have reacted with alarm to the US Government’s announcement of restrictions in the form of a surcharge on exports of steel and aluminium to the US, with the European Commission warning of proposals for “WTO compatible countermeasures” to rebalance the situation.

“We will not sit idly while our industry is hit with unfair measures that put thousands of European jobs at risk,” said Jean Claude Juncker, President of the European Commission, who slammed the US government’s protectionism.

“Protectionism cannot be the answer to our common problem in the steel sector. Instead of providing a solution, this move can only aggravate matters,” he said, following the announcement of import duties of 25 per cent on steel and 10 per cent on aluminium on Thursday. Cecilia Malmstrom, Commissioner for Trade, warned that the move would simply raise costs and reduce choice for US consumers of steel and aluminium. “These US measures will have a negative impact on transatlantic relations and on global markets,” she added.

In 2017, the EU exported 5 million tonnes of steel to the US out of a total export volume of 40 million tonnes, according to EU steel trade association EUROFER. “In the current context of massive global excess steel capacity, markets will be forced to take preventative contingency actions to avoid domestic market disruption from traded deflection,” said its director, Axel Eggert.

Tata Steel Europe, for which the US represents 10 per cent of its sales, welcomed the EU’s pledge of swift action. “The EU must not allow the moderate recovery in our industry over the last year to be destroyed by the EU’s most important ally,” said a Tata Steel Europe spokesperson.

The concerns were echoed in individual European markets, including in Britain, which exports some £360 million of high value steel products to the US, or around 15 per cent of the sector’s exports, according to industry body UK Steel.

In addition to hitting US exports, UK Steel warned the US move could have a knock on effect on markets such as the UK, with steel diverted away from the US to other markets. “In its imagined post-Brexit role as the vanguard for global free trade, it must remember that not everyone is on the same page and not everyone is playing by the same rules. Whilst we have to resist any urge to mirror such protectionist moves, we must at the same time be clear-eyed and equip ourselves with tools to respond effectively and protect our interests when necessary,” said UK Steel Head of Policy, Richard Warren.

German Chancellor Angela Merkel’s spokesperson said the federal government rejected the tariffs, and pledged to stand side-by-side the European Commission, the AFT reported.

Further details of the US plans are expected to be unveiled next week.

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