G20, how the US-EU agreement on the stop to tariffs on steel works

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October 31, 2021

On a practical level, a first move by the US will be achieved, the agreement on the stop to tariffs on steel and aluminum between the US and the EU.

In fact, Washington's decision to remove the tariffs and introduce quotas on imports based on the volumes of trade that existed in previous years will kick off the agreement.

When the US formalizes the announcement of the removal of duties, the EU will respond by rebalancing the measures it had taken in retaliation, on the basis of a procedure it had initiated at the WTO, the World Trade Organization and which had led to counter sanctions on goods imported from the US, in part already adopted in part no.

The one agreed at the G20 in Rome, therefore, is a first step that wants to overcome the conflictual phase of the dispute, aiming to return to a negotiation path that allows in turn to re-normalize the exchanges between the two economic giants. from contemporary announcements of the agreement by the two top representatives of the US and the EU. From what is learned from several sources between Rome and Brussels, the exact modalities of these announcements are still to be defined, but the agreement would be formalized by parallel communications by the US president, Joe Biden, and Ursula von der Leyen, the President of the European Commission who deals directly on these matters, in the first instance, on behalf of all EU countries.

The tariffs that it was agreed to cancel dated back to mid-2018, were decided by the then Trump administration and included a 25% tax on European-produced steel and 10% on aluminum, citing national security problems. had been contested by the EU.

After a series of unsuccessful attempts to settle the dispute amicably, Brussels had resorted to the WTO and adopted multi-billion dollar retaliation measures on US exports.

Some of these reprisals, however, had been suspended as a gesture of goodwill towards the new US administration, led by Biden.

Now the agreement which represents a clear gesture of relaxation between the two economic giants, after the catastrophic withdrawal from Afghanistan in recent weeks had put even the most pro-Atlantic EU countries in difficulty.

Not to mention the supply of atomic submarines to Australia, "to the detriment" of a contract blown up in Paris that had triggered a US-French diplomatic clash.

Precisely on the occasion of this G20 in Rome, Biden and the French president, Emmanuel Macron, took a first step towards rapprochement with a bilateral one: the tenant of the White House acknowledged that the US was a bit "clumsy".