50 percent tariff<\/a> on all steel imports to the US.<\/p>\nThe EU also wants to protect its steel sector from the challenge of global overcapacity.<\/p>\n
In a speech at the European Parliament in Strasbourg on Tuesday, the European Commissioner for Trade and Economic Security, Maros Sefcovic, defended the bloc\u2019s steel tariffs proposal as a move to \u201cprotect the bloc\u2019s vital sector\u201d whose steel trade balance has \u201cdeteriorated dramatically\u201d.<\/p>\n
Sefcovic added that more than 30,000 jobs have been lost since 2018 in the EU\u2019s steel industry, which employs about 300,000 people overall.<\/p>\n
While the industry is ailing, he said, other countries have begun imposing tariffs and other safeguards to ensure their own domestic steel industries expand. The Commission\u2019s proposal, therefore, seeks to \u201crestore balance to the EU steel market\u201d.<\/p>\n
More succinctly, a senior EU official told The Times newspaper: \u201cMy dear UK friends, you have to understand that we have no choice but to limit the total volumes of imports that come into the EU, so this is the logic that we apply clearly. Not acting could result in potentially fatal effects for us.\u201d<\/p>\n
The EC\u2019s proposal comes as the bloc\u2019s steel sector faces stiff competition from countries like China, where steel production is heavily subsidised.<\/p>\n
China produced more than a billion metric tonnes of steel last year, followed by India, at 149 million metric tonnes, and Japan, at 84 million metric tonnes, according to the World Steel Association, a nonprofit organisation with headquarters in Brussels.<\/p>\n
By comparison, said Sefcovic, the EU produces 126 million tonnes per year but only requires 67 percent of this for its own use \u2013 \u201cwell below the healthy 80 percent benchmark and below profitable levels\u201d.<\/p>\n
Moreover, steel production within the EU has declined by 65 million tonnes per year since 2007 \u2013 with nearly half of that lost since 2018.<\/p>\n
\u201cA strong, decarbonised steel sector is vital for the European Union\u2019s competitiveness, economic security and strategic autonomy. Global overcapacity is damaging our industry,\u201d EC President Ursula von der Leyen said.<\/p>\n
The Commission\u2019s industry chief, Stephane Sejourne, told reporters in Strasbourg that \u201cthe European steel industry was on the verge of collapse\u201d and said that through the tariffs plan, the Commission is \u201cprotecting it [EU\u2019s steel industry] so that it can invest, decarbonise and become competitive again\u201d.<\/p>\n
Sejourne added that the Commission\u2019s plan is \u201cin line with our [EU] values and international law\u201d.<\/p>\n
Why would the UK bear the brunt of EU steel tariffs?<\/p>\n
The EU is the UK\u2019s largest market for steel exports by far. In 2024, the UK exported 1.9 million metric tonnes of steel, worth about 3 billion pounds ($4.02bn) and representing 78 percent of its home-made steel products to the EU.<\/p>\n
While the EC\u2019s steel tariffs proposal does not apply to members of the European Economic Area, namely Norway and Iceland, it will apply to the UK and Switzerland. Ukraine will also be exempt from the tariff quota since it is facing \u201can exceptional and immediate security situation\u201d, according to the EC.<\/p>\n
The EU says it is open to negotiations with the UK once it has formally notified the World Trade Organization (WTO) of the new levy. For now, however, uncertainty looms.<\/p>\n
Compounding this, the UK also fears being flooded by cheaper, subsidised steel from Asia as both the EU and US markets close their doors to it.<\/p>\n
In a statement, UK Steel added: \u201cThe potential for millions of tonnes that will be barred from the EU market, to be redirected towards the UK is another existential threat.\u201d<\/p>\n
Nicolai von Ondarza, an associate fellow at Chatham House, the London-based policy institute, told Al Jazeera that cheap steel diverted by the EU\u2019s planned tariffs will mostly come from countries like China, \u201cputting additional pressure on its industry\u201d.<\/p>\n
The British steel sector is also shouldering Trump\u2019s 25 percent tariff on British steel imports, a global supply glut, and higher energy prices, and has been embattled by job losses in some of its biggest steelworks due to green transition initiatives.<\/p>\n
Can the UK negotiate its way out of this?<\/p>\n
That is currently its best hope, according to industry leaders.<\/p>\n
\u201cWe would urge the UK and EU to begin urgent negotiations and do everything possible to prevent the crushing impact these proposals would have on our steel industry,\u201d he added.<\/p>\n
Chatham House\u2019s Ondarza told Al Jazeera: \u201cFor the UK, the first route is to try to negotiate a carve-out of these EU tariffs. Both the EC and the UK have already signalled willingness to talk. These negotiations are likely to be tricky, but not unlikely that they come to an agreement.\u201d<\/p>\n
On his way for a two-day business trip to India, UK Prime Minister Keir Starmer told reporters that his country is \u201cin discussions with the EU\u201d about the proposal.<\/p>\n
\u201cI\u2019ll be able to tell you more in due course, but we are in discussions, as you\u2019d expect,\u201d he said.<\/p>\n
Meanwhile, Chris McDonald, the UK industry minister, has suggested that retaliatory measures may not be completely off the table.<\/p>\n
\u201cWe continue to explore stronger trade measures to protect UK steel producers from unfair behaviours,\u201d he told reporters.<\/p>\n
If the US caused this, can it help to solve it?<\/p>\n
While the EU\u2019s tariffs proposal has led to an outcry in the UK, it is also a measure which seeks to bring the US to the negotiating table, the EC says.<\/p>\n
In August, the EU and US agreed a trade deal under which Washington will levy 15 percent tariffs on 70 percent of Europe\u2019s exports to the country. Brussels and Washington have yet to discuss how tariffs would apply to European steel, which still faces a 50 percent tariff under Trump\u2019s new trade regime.<\/p>\n
Sefcovic told reporters the Commission\u2019s steel tariffs proposal would be a good foundation to engage with the US and also fight the challenge of overcapacity as \u201clike-minded partners\u201d.<\/p>\n","protected":false},"excerpt":{"rendered":"The European Union\u2019s plan to hike tariffs on steel imported over and above its annual threshold could tip…\n","protected":false},"author":2,"featured_media":483009,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3,4],"tags":[802,748,32,393,299,13641,4884,12,1144,712,1219,16,15,1764],"class_list":{"0":"post-483008","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-uk","8":"category-united-kingdom","9":"tag-brexit","10":"tag-britain","11":"tag-donald-trump","12":"tag-england","13":"tag-europe","14":"tag-explainer","15":"tag-great-britain","16":"tag-news","17":"tag-northern-ireland","18":"tag-scotland","19":"tag-trade-war","20":"tag-uk","21":"tag-united-kingdom","22":"tag-wales"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@uk\/115338715176586293","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/483008","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/comments?post=483008"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/483008\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media\/483009"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media?parent=483008"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/categories?post=483008"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/tags?post=483008"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}