Trump’s steel and aluminium tariffs: A problem for some products

You will have read many columns in the past weeks on the wild and unstable tariff-hikes announced by the Trump 2.0 administration. Yet, only a fraction of these announcements was effectively implemented. Here we look at one of them, the steel and aluminium tariffs, and try to gauge their relevance for UK exporters. Let us start by recalling the core elements of the policy. On March 12th the US applied new and higher import tariffs on steel and aluminium products from all countries. These tariffs expand the existing “Section 232” tariff programme on steel and aluminium, first applied in 2018 by the Trump 1.0 administration, in three main ways: all existing exemptions and special arrangements were closed. After the application of Section 232 tariffs in 2018, several countries reached arrangements with the US to be fully or partly exempt from these taxes. The UK benefited from tariff-rate quotas on both steel and aluminium but this arrangement, together with those of several other countries (including, among others, the EU, Canada, Mexico, Japan, and Australia) was now terminated. tariffs on aluminium products were increased from 10% to 25% tariffs were expanded to cover several products containing steel and aluminium, i.e. derivatives produced [...]

By , |2025-03-21T13:32:15+00:0021 March 2025|Blog, International Trade|0 Comments
Read More

The ‘new normal’: Can the UK and other democratic middle powers play a pivotal role?

We are now living in the ‘new normal’ where the US presence is absent in maintaining the international trade order. The US played a major role in building and maintaining the open and rules-based world trade order from the latter half of the 20th century to the first decade of the 21st century. During the first Trump administration (2017-2021), world trade was exposed to US protectionism involving unilateral tariffs, withdrawal from the Trans-Pacific Partnership (CPTPP) and the renegotiation of the North American Free Trade Agreement (NAFTA). The Biden administration (2021-2024) revised the US’ unilateralism by promoting international cooperation with its strategic allies in areas of US interest, such as G7 work on economic security and the Indo-Pacific Economic Framework for Prosperity (IPEF). Yet, its inward-looking approach remained basically the same as the previous Trump presidency. For example, President Biden retained most of the unilateral tariffs, especially those on Chinese imports, that were imposed during the Trump administration. The Inflation Reduction Act (20220) and CHIPS and Science Act (2022) prioritised domestic industry by providing subsidies and other financial incentives. The ‘new normal’: The absence of the US in the international trade order With Trump back as President of the US, we are [...]

By |2025-03-14T14:21:55+00:0014 March 2025|Blog, International Trade, UK - Non EU|0 Comments
Read More

Will Trump’s tariff policy correct an unusual imbalance?

One of the quirks of tariff regimes is that EU and UK light vehicle exports to the US face just a 2.5% tariff whereas those coming the other way face a 10% charge on a vehicle's declared landed value[1]. It seems surprising that this difference has continued for as long as it has, but it probably won’t last much longer. President Trump has been threatening allies and enemies alike with tariffs but – as in Canada and Mexico – he has postponed them following political, or rather quasi-military concessions. It would not been entirely surprising if these threatened tariffs were not actually implemented. While with Trump it is unwise to be too definitive with predictions, in this fast-changing environment steel and aluminium-specific tariffs now appear likely. Attention now shifts to the EU and the UK. The former has long been in the President’s sights, and the latter potentially is, too, although Trump has hinted he could give the UK better treatment than the EU. The promise of a second state visit and a ride down the Mall in a gilded cage or carriage, may have some economic benefits after all. Significantly, before President Trump has “decided” on his tariff policy [...]

By |2025-02-11T08:59:37+00:0010 February 2025|Blog, International Trade, UK - Non EU|0 Comments
Read More

How much damage could Trump’s tariffs do and what can be done?

The short answer to the first part of the question is: “a lot” - and the damage is likely to be both globally and to the US itself. A longer answer is that, in many respects, we do not really know. This is because it is unclear why these US policies are being introduced, whether they may be reversed, and what other policies may be introduced or threatened both by the US as well as by other countries. The short answer to the second part of the question is “not much”. However, a the longer answer would be: it is horribly complicated with so many unknowns, but governments and businesses need to think long term, cooperate and be proactive as opposed to reactive. This is not easy. At present the policies being introduced against other countries largely amount to threatening to introduce or raise tariffs on goods. If we therefore focus on goods trade in 2023, the United States accounted for just under 14.5% of world imports, and just over 8% of world exports. This means that out of the total world demand for goods being exported, the US buys one-seventh of these and supplies roughly one-twelfth of world exports. [...]

By |2025-02-03T17:20:17+00:003 February 2025|Blog, International Trade|0 Comments
Read More

UK food safety Statutory Instruments: A problem for US-UK negotiations?

12 September 2019 Chloe Anthony and Dr Emily Lydgate – lecturer in Law at the University of Sussex and a fellow of the UK Trade Policy Observatory. The US remains top of the list of post-Brexit UK trade negotiations, with Boris Johnson recently putting a quick US deal as a first priority. The US’s strongly-worded negotiating objectives include loosening EU ‘non-science-based’ bans or restrictions on Genetically Modified Organisms (GMOs), pesticides, food additives, hormone-enhanced meat, in addition to the infamous chlorinated chicken. As former international trade secretary Liam Fox conceded, a US-UK Free Trade Agreement (FTA) that excludes food and agriculture is a non-starter from the US perspective. […]

By |2019-09-12T12:05:39+01:0012 September 2019|UK - Non EU|1 Comment
Read More

Mimicking President Trump? – Trade and Politics in Japan’s Recent Export Measure

5 September 2019 Guest blog by Professor Yong-Shik Lee is Director and Professorial Fellow of the Law and Development Institute and Hiram H. Lesar Distinguished Visiting Professor in Law, Southern Illinois University School of Law. In the last eighteen months, President Trump has re-introduced the use of national security arguments to restrict the USA’s international trade for commercial reasons. I recently warned[1] that the US use of security arguments to justify its additional tariffs on steel and aluminum imports would create a dangerous precedent, and shortly after that, another major trading nation has indeed followed this precedent. […]

By |2019-09-05T09:29:36+01:005 September 2019|UK - Non EU|2 Comments
Read More

Trump and Mexico: Why the UK should care

07 June 2019 Julia Magntorn Garrett is a Research Officer in Economics at the University of Sussex and a fellow of the UK Trade Policy Observatory.  On Thursday last week (May 30) President Donald Trump threatened to levy tariffs on all US imports from Mexico. The UK should take note, as this has implications not only for Mexico, but for the UK as well. […]

By |2019-06-07T08:50:38+01:007 June 2019|UK - Non EU|1 Comment
Read More

The US negotiating objectives for the UK-US trade deal clearly put America First.

5 March 2019 Ilona Serwicka is Research Fellow in the economics of Brexit at the UK Trade Policy Observatory. Last week, the United States published a document that set out their negotiating objectives for a trade agreement with the UK, shortly after the publication of virtually identical documents for negotiating with the EU and with Japan. Those in the UK who expected ‘special treatment’ from the US are in for a disappointment, but not a surprise (as UKTPO researchers pointed out in October 2016). In negotiating with major trading partners after Brexit, the UK is likely to be a price taker because of a power imbalance. […]

By |2019-03-05T11:17:50+00:005 March 2019|UK - Non EU|8 Comments
Read More

The Real Donald Trump: A Free Trader in Protectionist Clothing or Vice Versa?

7 November 2018 Rodney D. Ludema is a Professor of Economics, with a joint appointment in the School of Foreign Service and the Department of Economics at Georgetown University, Washington D.C. (See bio below) As the fifth meeting of the U.S. and U.K. Trade and Investment Working Group takes place this week in Washington, hope for an eventual U.S.-U.K. trade deal is on the rise, thanks to the White House’s recent notification to Congress of its intent to launch formal negotiations. This new optimism is astonishing in light of Trump’s protectionist moves of the past year and raises questions about the direction of U.S. trade policy more generally. Should Trump’s free trade overtures be taken seriously? Do they represent a change in strategy or even a change in tactics? How ambitious should we expect a U.S.-U.K. trade deal to be? To answer these questions, it is helpful to understand Trump’s motivations and the policy environment in which his policies are being developed.  Such is the goal of this essay. […]

By |2018-11-07T08:57:59+00:007 November 2018|UK - Non EU|1 Comment
Read More

Partners

University of Sussex Logo

© 2024 UK Trade Policy Observatory

Site by: Phipps Design

Go to Top