US and UK reach trade deal to end tariffs on UK steel and US whiskey

WASHINGTON — The United States and the United Kingdom reached a trade deal on Tuesday that will remove U.S. tariffs on British steel and aluminum, while the United Kingdom will lift taxes on whiskey, motorcycles and American tobacco.

Biden administration officials have said the UK deal will allow the UK to ship “historic sustainable volumes” of steel and aluminum products to the US without levies imposed under the old Trump administration.

In exchange, the UK will lift retaliatory duties on more than $500 million of US exports to the UK, including distilled spirits, agricultural products and consumer goods.

The deal also requires any British steel company owned by a Chinese entity to audit its financial statements to assess possible Chinese influence and share the results with the United States, according to a statement by Commerce Secretary Gina Raimondo and from US Trade Representative Katherine Tai.

The United States wants to counter China’s influence in the world by providing everything from infrastructure to vaccines and green energy. The WSJ’s Stu Woo explains how the plan, dubbed Build Back Better World, aims to compete with China’s Belt and Road initiative. Photo composition: Daniel Orton

Tuesday’s deal follows similar agreements the Biden administration has signed with the European Union and Japan in recent months as part of its efforts to restore trade relations with friendly nations strained during the trade war. former President Donald Trump.

Officials said the deal will help lower costs for U.S. companies buying imported steel, while discouraging large increases in imports by keeping tariffs on shipments above the agreed level.

Ms Raimondo said the pact benefits “American steel and aluminum industries and workers by protecting manufacturing, and consumers by easing inflationary pressures in the United States.”

The Steel Manufacturers Association, a trade group for companies that make steel in electric furnaces by melting scrap metal, applauded the pact, with President Philip K. Bell saying it would help address capacity issues global steel surplus and illegal dumping of steel by foreign entities. .

The agreement was announced during a visit to the United States by the British Secretary of State for International Trade, Anne-Marie Trevelyan, to launch new trade dialogues to strengthen bilateral cooperation.

During two days of meetings in Baltimore, Ms. Trevelyan and Ms. Tai discussed issues such as sanctions against Russia for its invasion of Ukraine, reducing supply chain congestion, decarbonizing their economies, promoting digital trade and supporting national labor and labor rights.

Ms. Trevelyan then met with Ms. Raimondo in Washington to seal the tariff deal.

Import duties of 25% on steel and 10% on aluminum from various countries were imposed by Mr Trump in 2018, who said protecting the US steel industry from imports low cost was a matter of national security.

The tariffs have succeeded in lowering steel imports, but have not led to the steel revival promised by Mr Trump.

Under the deal, the UK will be allowed to ship up to 500,000 annual metric tonnes of steel duty-free, split between 54 products, an amount based on trade volume in 2018 and 2019. The agreement also set duty-free quotas for several types of aluminium.

The two countries will co-operate to address excess capacity they blame on non-tradable economies, including China, but the UK will not join the US and the EU in negotiating a ‘global energy agreement’. sustainable steel” aimed at encouraging metal manufacturers to reduce their greenhouse gases. emissions.

Write to Yuka Hayashi at [email protected]

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Appeared in the print edition of March 23, 2022 under the title “US, UK Strike Trade Deal on Tariffs”.

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