March 9–The next two weeks will be critical for global steel and aluminum exporters seeking to win exemptions from new U.S. tariffs, Trump administration officials said today.

A day after U.S. President Donald Trump signed proclamations starting tariffs on steel and aluminum that take effect March 23, his Cabinet secretaries downplayed the decision’s impact on the global trading system.

“We’ve already exempted out Canada and Mexico,” U.S. Treasury Secretary Steven Mnuchin told CNBC today. “The president can do exemptions. And my expectation is there may be other countries he considers in the next two weeks.”

Negotiating Leverage

The flexibility to exempt products and countries from the tariffs gives Trump extra leverage in negotiations over trade agreements. The United States is currently reshaping its NAFTA agreement with Canada and Mexico and is also starting negotiations to amend the Korea-US Free Trade Agreement. The exemptions for Canada and Mexico are set for the first 30 days.

The Commerce Department also has the authority to exempt certain products from the tariffs, based on requests by both global exporters and U.S. importers reliant on purchasing them. The department is expected to release guidelines for requesting exemptions within nine days if not sooner.

Commerce Secretary Wilbur Ross doubted U.S. trading partners could legally retaliate against U.S. exports until a case is taken up and decided upon by the World Trade Organization.

Ross also doubted the WTO would rule against the United States if a case is considered. “”WTO rules include a specific call out for national security and national defense. I think it’s highly unlikely that the WTO will think that it can tell the United States government what’s in its national security interest,” Ross said on NPR’s Morning Edition.

WTO Dispute

Brazil has reportedly already indicated it is filing a dispute with the WTO, according to a news report by the Xinhua Net News.

Officials from several U.S. trading partners, including the EU and South Korea, have indicated they might join a legal appeal.

South Korea has been slow to react with public condemnations against the new tariffs, as others have, perhaps due to sensitive diplomatic talks it is arranging between the United States and North Korea later this Spring. However, South Korean steel producers could potentially have a lot to lose. As the third-largest steel exporter to the United States, South Korean industries are projecting a loss of up to $6.76 billion over the next three years, according to the Hyundai Research Institute as reported by the Korean Herald.

Source: ITA

Conflict or Collaboration?

The EU, Australia and Japan have all said they would seek exemptions from the tariffs.

EU Commissioner for Trade Cecilia Malmström said she would seek more clarity on the issue in the days to come and discuss it with U.S. Trade Representative Robert Lighthizer, who is scheduled to be in Brussels on March 10.

Earlier this week, Malmström put forward a tougher stance, saying the EU would respond with countervailing measures on U.S. products.

U.S. Commerce Secretary Ross suggested that global collaboration against the problem of overcapacity in steel is ultimately the goal.

“We’re not trying to blow up the world. There’s no intention of that,” Ross said. He said the tariffs needed to be broader than China. “We hope and we believe that at the end of the day, there will be a process of working with the other countries who are our friends, who by the way, are also somewhat victimized by the same practices.”

Commerce Secretary Wilbur Ross: Tariffs will increase competition from CNBC.

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About Author

Patti Mohr is an independent journalist living in North Carolina. She has a Master's Degree in International Commerce and Policy from George Mason University and a Bachelor's Degree in Political Science and a certificate in journalism from the University of Cincinnati. After spending 12 years working in Washington, D.C., Patti moved to North Carolina where she consulted clients with their resumes and began working in property management. She continued to work on research and writing on an independent basis and conceptualized the structure for a media organization that would support independent journalism. Patti's lifelong dream is to pursue a career in writing about international relations. She has a strong belief in the fundamentals of journalism, namely the pursuit of truth, the maintenance of independence from sources, and in the verification of information. She is a reliable researcher with strong analytical and problem-solving skills.