European Union's Plan to Match Trump's Steel Tariffs Poses 'Existential Threat' to British Steel Sector
The European Union declared plans to adopt Donald Trump's import duties on steel, increasing to double taxes on foreign steel to fifty percent in a action condemned as "a survival risk" to the industry in Britain.
Major Challenge for UK Steel Industry
Given that 80% of UK steel shipments destined for the EU, this policy shift poses the British steel sector's most severe challenge, according to the lobby group speaking for the sector.
New EU Proposals and Rules
In its plan submitted to the European parliament on Tuesday, the European Commission also proposed slashing the current allowance for tariff-exempt steel and obliging foreign suppliers to state the origin of steel production to stop China sneaking products in through third nations.
The European steel industry stood at the brink of failure – these measures safeguard it so that it can invest, reduce emissions, and regain competitiveness.
Replacement of Current Framework
These measures are intended to supersede a import framework that has been functioning for the last seven years and which is set to expire in 2026 and is now considered ineffective. Inaction could have been "fatal" for the industry, a European official stated.
Industry Response and Warnings
Nevertheless, Gareth Stace, from the industry body British Steel, said EU increasing duties would pose "the biggest crisis the UK steel industry has ever faced".
He called on the government to "acknowledge the critical necessity to implement its own measures to protect" the British steel sector – which is still reeling from a twenty-five percent tariff from the US earlier this year – from the risk of millions of tonnes of global steel diverted away from US and European markets.
This flood of imports "might prove fatal for numerous steel companies.
Labor and Political Pressure
Union leaders, assistant general secretary at steelworkers' union Community, said the proposed changes posed "a survival risk" to UK steel.
Unions and industry leaders called on the UK government to begin talks immediately with the European Union on country-specific duty-free quotas, noting that the United Kingdom was now the EU's primary export market.
Industry Background
Sector representatives in the European Union have repeatedly cautioned for months that the European steel sector faces being "eliminated" through the new 50% tariffs on exports to the US along with rising energy prices and cheap Chinese competition.
The steel industry on both sides of the Channel is considered a foundational industry, providing basic materials in products ranging from building frameworks, renewable energy equipment and transport infrastructure to dishwashers and cutlery.
Adoption and Next Steps
These proposals require approval by member states and the European parliament, with the European Commission president urging national governments and European parliament members to act fast in support of the initiative.
If the plan is ratified, the EU will reduce its existing tariff-free allowance by forty-seven percent to 18.3m tonnes a year, a level previously recorded in 2013. It will apply a 50% duty on imports exceeding the limit and oblige countries shipping to the bloc to declare the production origin to prevent circumvention of the measures.
Exemptions and International Cooperation
Norway, Iceland, and Liechtenstein will be exempt from tariff quotas or tariffs because of their strong economic ties in the European Economic Area, the European Union has confirmed.
Alongside the proposal, the European Union is pursuing a "metals alliance" with the United States to ringfence their respective economies from excess production.
The European Union must take immediate action, and decisively, before operations cease in significant portions of the European steel sector and its value chains.
