Trump's tariffs - tit for tat

 

 

  • EU imposes tariffs on US goods worth €2.8 billion
  • Maize, motorcycles and steel caught in trade dispute
  • Ibec concern for Irish business

 

On Wednesday 20 June, the European Commission adopted measures to immediately impose additional tariffs on a list of US products worth €2.8bn. This was in response to the imposition of tariffs on steel and aluminium by the US. Concurrently, the EU is engaging the World Trade Organisation (WTO) dispute resolution process arguing that the US has breached WTO law by applying these tariffs.


Further tariffs, on imports from the US valued at €3.6 billion, will enter into force at a later stage: either in March 2021 or if there is a positive finding in the WTO dispute settlement process that the US has acted unlawfully, whichever comes first.

 

€59 million worth of goods imported to Ireland from the US will be affected by the tariffs


The new tariffs are calculated as a percentage of a products customs valuation and came in to effect on Friday, 22 June 2018. A total of €59 million worth of goods imported to Ireland from the US will be affected by the tariffs. Maize and steel are amongst the most imported items. Overall the goods subject to tariffs account for 0.4% of total imports from the US, which is the second lowest share in the EU. In value terms, Ireland is 9th most exposed (as we import more from the US than other countries).


In March, Ibec expressed its concern with the US decision to introduce tariffs of an additional 25% on steel and 10% on aluminium products. The EU initially secured an exemption, which expired on 1 June 2018. Currently, Australia is the only country with an exemption.


Ibec accepts that the EU must respond to this action. However, the response must be proportionate and lawful. Europe and the US should work together to address shared global concerns at the multilateral level.


We remain concerned that this situation will escalate into a sustained trade war further impacting global supply chains with the resulting negative impacts on Irish business and consumers.


The full list of products that are subject to tariffs now and the proposed tariffs in 2021 is available here.