In 2018, former President Donald Trump imposed tariffs on steel imports to fulfill a campaign promise, naturally making steel imports expensive. Consequently, exporters had to find a new market in the European Union (EU), and in 2019, the bloc decided to impose limits in retaliation. Following the UK's exit from the EU, the country is attempting to establish new rules for trade with other countries.
The Difference from the EU Policy
In June 2021, the Trade Remedies Authority (TRA), a body operating in the UK's Department for International Trade, said it recommends not renewing the limits on the tariffs inherited from the EU. Once steel importers reach the quotas, they will not face steep duties, and they are due to expire in the same month. The revocation will affect nine steel product categories, such as bars and wires, but the TRA will also extend the limits for another three years for ten products, including steel for railways, gas pipes, and large sheets.
The TRA doesn't believe that the steel product imports were in such large quantities, and even if the amounts increased, they would cause significant damage to the UK industry. UK Steel, a lobby group disagreeing with the notion, believes that the decision would leave UK steel producers vulnerable to import surges. In particular, it explains that if producers can't sell the steel in the US or EU, it will flood the UK steel market with cheap imports. The Department of International Trade has the last say on the matter.
International Trade Minister Liz Truss decided to overrule the TRA, possibly to avoid a backlash from the steel industry. She stated that the government would continue to extend import restrictions on five of the nine steel categories for another year. The protectionist move will levy 25% tariffs on imports that do not fall within the quotas. UK Steel has backed the government's new stance, claiming that it will protect a £2 billion industry employing 33,700 people. The trade union Unite, on the other hand, was concerned that the government had simply kicked the can down the road, and that steelmakers would soon be in a similar situation.
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