The United States has agreed to settle a Donald Trump-era diplomatic rift with the European Union over steel and aluminum tariffs, the White House announced on Saturday.
The announcement comes as President Joe Biden is attending the Group of 20 summit in Rome.
National security adviser Jake Sullivan, US Trade Representative Katherine Tai, and Commerce Secretary Gina Raimondo announced the agreement Saturday. They said that the Article 232 tariffs won’t be removed entirely but that some quantity of European steel and aluminum will be allowed to enter the country without tariffs under the deal.
“We were able to reach an agreement whereby the EU will drop their retaliatory tariffs (on American goods),” Raimondo said. The agreement would ensure “that all steel entering the US via Europe is produced entirely in Europe,” Raimondo was quoted as saying by the Associated Press.
The Trump administration had placed taxes on EU steel and aluminum in 2018 on the claim that the foreign products produced by American allies were a threat to the country’s national security. Europeans and other allies were outraged by Trump’s use of Article 232 to justify the tariffs, leading many to impose counter-tariffs on US-made motorcycles, bourbon, peanut butter, and jeans, among other items.
The easing of the tariffs is a key step for President Joe Biden‘s bid to unwind one of Trump’s legacies as he tries to reset the US relationship with Europe.
The back-and-forth in tariffs hurt European producers and raised steel costs for American companies. The tariffs also did not achieve Trump’s stated goals of creating jobs at steel mills. The Bureau of Labor Statistics shows that jobs in the manufacturing of primary metals did rise slightly, to as much as 389,100 in 2019. But mills shed workers during the pandemic, and employment in the sector is roughly half of what it was in 1990, the Associated Press reported.
The European Union took steps in May to improve relations. On some retaliatory tariffs, the EU temporarily suspended planned increases. This meant that American whiskey faced a 25% tax in Europe, instead of a planned 50% tax. The two sides faced a December deadline to avoid the higher tax rate.
(With AP inputs)