The U.S. and the European Union have pushed back a deadline for concluding negotiations on a steel trade agreement but still face a potential renewal of tariffs on each other’s goods at some point if those talks are ultimately unsuccessful.
In October 2021 the U.S. lifted its Section 232 tariffs on steel and aluminum products imported from the EU after establishing a tariff-rate quota designed to limit such imports to “a sustainable historic level” (i.e., the volume shipped prior to the 2018 imposition of the tariffs). The EU, in turn, suspended its related retaliatory tariffs on U.S. goods and determined not to implement a further tariff increase that had been scheduled to take effect later that year. Related World Trade Organization disputes were also suspended.
These actions were designed to give the two sides time to negotiate a global arrangement designed to (1) discourage trade in high-carbon steel and aluminum that contributes to global excess capacity from other countries and (2) ensure that domestic policies support lowering the carbon intensity of these industries.
A recent meeting of U.S. and EU officials confirmed that the Oct. 31, 2023, deadline for concluding those negotiations would not be met. However, a joint statement said the two sides “look forward to continuing to make progress … in the next two months,” indicating that the deadline has been pushed back to the end of the year.
While tariffs could potentially be reinstated as of Jan. 1 if no agreement has been reached by then, press sources cited U.S. officials as saying that neither Washington nor Brussels is currently threatening such a course of action, apparently in the belief that doing so would only make the negotiations more difficult.
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