EU-US: two months of escalating trade tensions

Paris (AFP) – Here are key dates in the trade standoff between the European Union and the United States, as the clock ticks towards a May 1 deadline for averting a trade war:

– Trump threatens, EU responds –

On March 1, 2018, US President Donald Trump, who has made correcting his nation’s trade deficit a priority, announces that he intends to impose heavy tariffs on steel and aluminium imports.

The EU responds by drawing up a hitlist of flagship American products it could tax including Harley Davidson motorcycles, blue jeans, bourbon whiskey and peanut butter.

– Heavy taxes –

On March 8 Trump announces tariffs of 25 percent on steel products and 10 percent on aluminium from March 23. He brushes aside warnings from allies on the risks of a trade war with unpredictable consequences.

He bases his move on a rarely used procedure in US trade legislation: article 232 which allows him to limit the import of certain products to protect national security.

– Exemptions to May 1-

On March 22, on the eve of the tariffs coming into force, Trump announces that they will be suspended until May 1 for the European Union.

Australia, Argentina, Brazil, and South Korea are also exempted, while Canada and Mexico are spared as they are part of the North American Free Trade Agreement (NAFTA) trade bloc. 

China is not exempted and announces tit-for-tat tariffs, slapping duties on US cars.

– EU goes to WTO –

On April 16 the EU follows China in complaining to the World Trade Organization (WTO) over the tariffs.

“Having a substantial interest as an exporter in this case, the European Union requests consultations with the United States” to agree “safeguards”, the EU says. 

Two days later the EU’s Trade Commissioner Cecilia Malmstrom calls for the bloc to be “permanently and unconditionally excluded from these measures”. She says the EU will not negotiate with the US on trade issues otherwise.

– EU “prepared” –

On April 26 the US National Economic Council Director Larry Kudlow says that exemptions can not be extended beyond May 1 unless the EU makes “some concessions with respect to trading practices, tariffs and taxes”.

France’s Economy Minister Bruno Le Maire says that it is not up to Europe to make concessions.

On April 29 leaders of the EU’s three largest economies – Britain, France and Germany –  agree on the need to be “ready to react, if necessary, with efficiency and speed,” to new tariffs.