The car special duties have been postponed, the punitive tariffs for aluminum and steel from Canada and Mexico abolished: The US seems to want to relax trade conflicts – but not with China.
The US government is sending conciliatory signals to the domestic continent – for about a year now applicable special tariffs for Canada and Mexico have been lifted. In return, the two neighboring countries want to end their retaliatory tariffs. Both should be done within 48 hours.
It is the first time that US President Donald Trump has abolished tariffs as part of his „America First“ strategy. On Thursday, Trump halved steel tariffs against Turkey.
USMCA is not yet ratified
The punitive measures against Canada and Mexico were a major obstacle to the Nafta successor treaty USMCA.
The governments have already agreed on USMCA, but the treaty still has to be signed by the parliaments. Many MPs were reluctant – mainly because of the now abolished steel and aluminum tariffs. Although these had helped many US steel and aluminum producers, retaliation damaged other sectors of the economy, such as the important agricultural sector.
Together against China
Canadian Prime Minister Justin Trudeau announced that the new trade agreement would be ratified. His country remained firm in negotiations with the United States and has always called on Washington to completely lift its steel and aluminum tariffs.
In a joint statement, the US and Canada now announced plans to shield North America against cheap imports of steel and aluminum. The announcement is apparently aimed at China. The People’s Republic has long been accused of flooding world markets with subsidized metal, thereby depressing prices.
Mexican President Andrés Manuel López Obrador also stressed that it wanted to prevent metal imports at dumping prices.
Difficult talks with Beijing
That is exactly what some Republican politicians have demanded in the US Congress. „China is our opponent,“ said Republican Senator Ben Sasse. Trump is right in increasing the pressure on China for its espionage, its theft of intellectual property and its actions against the rule of law.
The trade talks between the US and China are apparently difficult. In several rounds of negotiations, no breakthrough was achieved. In the dispute with Beijing Trump has imposed special duties in the billions on Chinese goods. China responded with retaliatory tariffs.
Car special duties deferred
The Trump administration had also postponed the decision on special duties on car imports from the European Union and Japan for half a year on Friday. Trump issued a corresponding official statement. Accordingly, it will now be negotiated first about trade agreements.
However, the US reserves the right to continue to impose tariffs if no successful negotiations are concluded within 180 days. The German automakers would be hard hit because they deliver a particularly large number of vehicles in the United States.
In addition, manufacturers such as VW, Daimler and BMW as well as suppliers have their own locations in the US, which also serve the Chinese market. The German companies are therefore afraid of a further escalation of the US-China conflict.
