US should hit China on steel overcapacity: EC
Jun 21, 2018 | 08:22 AM
INS - Liz Newmark
The European Commission’s director-general for trade, Jean-Luc Demarty, told members of the European Parliament on Wednesday June 20 in a discussion about new tariff regimes that the United States must not attack the European Union for a problem “caused by China."
At the first meeting of the European Parliament’s international trade committee since the US’ decision on June 1 to impose Section 232 duties of 25% on steel and 10% on aluminium imported from the EU, Demarty said: “When China joined the World Trade Organization in 2001, most members were occupied with market access, but in my view we were not vigilant enough on the rules. It’s a pity that instead of asking China to reform, the US is targeting its allies, weakening us collectively.”
Demarty warned that a trade war over the tariffs was “in sight," particularly between the US and China.
The EU was not “retaliating," he said, but “taking a swift, firm, WTO-compatible response." It was launching proceedings against the US at the WTO and taking “safeguard action” to protect the European market from disruptions caused by the diversion of steel from the US, he added.
“[On June 14], all member states agreed to proceed with rebalancing measures,” Demarty told the committee. “The Commission is adopting the regulation imposing EU tariffs on selected products worth €2.8 billion [$3.2 billion], which will be published soon.”
“I’m not a psychologist, but we can’t appear weak,” Demarty added. “If we don’t react at all, it’s pretty certain we will face an endless process of new [tariff] additions and countermeasures.”
Meanwhile EU/US talks will continue, he said, though “there is no traction on the US side” to cut tariffs.
Demarty added that US President Donald Trump’s threat to impose additional duties for cars, probably before November’s mid-term elections, would be “very damaging for the whole world."
Liz Newmark - INS, Brussels