Backlash against US over tariffs


Backlash against US over tariffs

Nick Beams

2 June 2018

The meeting of G7 finance ministers taking place in Whistler, Canada this weekend has begun with a barrage of criticism directed at US Treasury Secretary Steven Mnuchin over the Trump administration’s decision to proceed with tariffs on steel and aluminium exports from Mexico, Canada and the European Union.

On his arrival, German Finance Minister Olaf Scholz immediately denounced the US actions. “The decision by the US government to unilaterally implement tariffs is wrong and—from my point of view—also illegal,” he told reporters. “We have clear rules, which are determined at the international level, and this is a breach of those rules.”

The Trump administration has imposed the tariffs under section 232 of the 1962 Trade Expansion Act on “national security” grounds. Scholz denounced the claim as “spurious.”

“We’ll always be ready to talk about reaching common agreement on trade policy, but that’s only possible if unilaterally implemented tariffs are lifted,” he said.

Canadian Finance Minister Bill Morneau, the chairman of the meeting, said the issue of trade conflicts had moved to front and centre. “I don’t want to kid you, we will need to talk about this first and foremost,” he said. “We think it’s absurd that Canada is considered in any way a security risk, so that will be clearly stated by me.”

The invocation of “national security” by the Trump administration is not because it regards Canada or the EU as a threat, but because it is seeking to exploit a loophole in the rules of the World Trade Organisation (WTO) that permits such tariff impositions. But the WTO rule is meant to cover only situations where countries are actually at war.

Consequently, there is concern…

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