(qlmbusinessnews.com . Thurs 13th Feb, 2025) London, UK —
UK Government Opts for Measured Response to US Steel Tariff Renewals
Whitehall has confirmed it will not be rushing into retaliatory measures following the United States' decision to reinstate tariffs on steel and aluminium imports. Trade Secretary Douglas Alexander stressed the need for a calm and considered approach, rather than a “knee-jerk reaction.”
The move by the US, announced by President Donald Trump, will see a 25% import tax slapped on all steel and aluminium entering the country from March 12th. This has sparked widespread concern across the UK steel industry, with many urging the government to follow the lead of the EU and Canada, who have vowed to respond in kind.
While the UK isn't a major exporter of steel to the US (accounting for roughly 10% of British steel exports), some specialist producers rely heavily on that trade relationship. The concern is that the tariffs will not only harm direct exports to the US but also lead to a “dumping” effect, where countries unable to export to America flood the UK market with cheaper steel, undercutting domestic businesses.
Gareth Stace, head of UK Steel, described Trump's action as taking a “sledgehammer to free trade,” calling for a stronger response from ministers. He highlighted the crucial role UK steel plays in US industries, adding that collaboration on global overproduction was preferable to confrontation.
Unite, the union representing UK steelworkers, has urged the government to prioritise buying British steel in public procurement projects.
Ministers were scheduled to meet with industry representatives and unions today, with visits to key steel plants planned for later in the week. Speaking in Parliament, Mr. Alexander said the deadline for the tariffs offered time for engagement with both UK stakeholders and US trade officials.
However, Shadow Trade Secretary Harriett Baldwin criticised the government's lack of “gusto” in engaging with the US administration. Liberal Democrat leader Ed Davey echoed these concerns, calling for urgent action to protect British jobs.
The UK's cautious stance signals a departure from the more assertive approach taken by some of its G7 allies. Canadian Industry Minister François-Philippe Champagne denounced the tariffs as “totally unjustified,” while European Commission President Ursula von der Leyen warned that “unjustified tariffs on the EU will not go unanswered.”
A spokesperson for Prime Minister Sir Keir Starmer sidestepped a direct condemnation of Trump's actions, stating that the government would “take a considered approach” and act in “our national interest.”
President Trump has a history of imposing import taxes, often targeting countries with trade surpluses with the US. While the tariffs are paid by the importing companies, these costs can be passed on to consumers, absorbed by the companies, or lead to reduced imports. Exporters might also lower prices to maintain sales.
Trump previously introduced similar tariffs in 2018, but many countries, including the UK, later secured exemptions. This time, he has suggested he will not grant any exemptions, although Australia is reportedly being considered.
The delay of tariffs on Canada and Mexico has raised questions about the overall implementation of the measures.
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