2023-10-20 11:00:05
The United States and the European Union have not yet reached an agreement on steel and aluminum before the Washington summit, which begins this morning, and are prepared to continue negotiations until the end of the year, when tariffs on thousands of millions of dollars from transatlantic trade in the absence of an agreement.
The impasse deprives US President Joe Biden, European Commission President Ursula von der Leyen and European Council President Charles Michel of being able to announce an agreement on the so-called Global Agreement on Sustainable Steel and Aluminum at the meeting in Washington on Friday, as expected, according to people familiar with the discussions.
A meeting on Thursday between US trade representative Katherine Tai and the EU’s chief trade negotiator, Valdis Dombrovskis, ended without a deal.
The talks aimed to resolve a dispute that began when then-President Donald Trump imposed tariffs on metal imports from Europe, citing national security risks, to which the EU responded with retaliatory measures. Failure to reach a deal would mean that duties on $10 billion of steel and aluminum exports between the EU and the US would automatically come back into force in early 2024.
The two sides are likely to delay a deal on critical minerals that they had also hoped to announce this week, according to the people. Such an agreement would allow European companies to access some of the benefits of Biden’s Inflation Reduction Act.
The GSA has two main objectives: combating excess production in non-market economies and carbon emissions in dirty metals. Negotiators made progress on the first of these two issues. On excess capacity, the EU is open to launching investigations in the coming months that could lead to new tariffs targeting non-market practices in economies like China, while the US could introduce additional fees of its own.
Other unresolved issues include the agreements’ compatibility with the World Trade Organization’s international trade rules, especially in the context of concerns that the agreement could be seen as a coalition of the EU and the United States against China.
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