EU Threatens Countermeasures over Trump's Steel Tariffs Hike
The European Commission said on Saturday that Europe was prepared to retaliate against President Donald Trump's plan to double tariffs on imported steel and aluminum, raising the prospect of an escalating trade fight between two of the world's largest economic powers.
Trump's announcement on Friday that he would increase tariffs on imported steel and aluminum to 50% from 25%, intensifies his global trade war and came just hours after he accused China of violating an agreement with the US to mutually roll back levies and trade restrictions for critical minerals.
The European Commission said it "strongly" regrets Trump's plan to increase tariffs, adding it "undermines ongoing efforts to reach a negotiated solution."
"This decision adds further uncertainty to the global economy and increases costs for consumers and businesses on both sides of the Atlantic," a European Commission spokesperson said, adding that "the (European Union) is prepared to impose countermeasures."
The spokesperson noted that the European Union had paused its countermeasures to create space for continued negotiations.
"The European Commission is currently finalizing consultations on expanded countermeasures. If no mutually acceptable solution is reached, both existing and additional EU measures will automatically take effect on 14 July or earlier, if circumstances require," the spokesperson added.
Trump announced the higher tariffs just outside Pittsburgh, where he was talking up an agreement between Nippon Steel and US Steel. Trump said the $14.9 billion deal, like the tariff increase, will help keep jobs for steel workers in the US.
He later posted on social media that the increased tariff would also apply to aluminum products and that it would take effect on Wednesday.
The planned US move ratchets up pressure on global steel producers, and has sparked protests from trading partners around the world.
Canada's Chamber of Commerce quickly denounced the tariff hike as "antithetical to North American economic security."
"Unwinding the efficient, competitive and reliable cross-border supply chains like we have in steel and aluminum comes at a great cost to both countries," Candace Laing, president of the chamber, said in a statement.
Canada's United Steelworkers union on Saturday called the move a direct attack on Canadian industries and workers.
Australia's center-left government also condemned the tariff increase, with Trade Minister Don Farrell calling it "unjustified and not the act of a friend."
The US is the world's largest steel importer, excluding the European Union, with a total of 26.2 million tons of imported steel in 2024, according to the Department of Commerce. As a result, the new tariffs will likely increase steel prices across the board, hitting industry and consumers alike.
Steel and aluminum tariffs were among the earliest put into effect by Trump when he returned to office in January. The tariffs of 25% on most steel and aluminum imported to the US went into effect in March, and he had briefly threatened a 50% levy on Canadian steel but ultimately backed off.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Arab News
4 hours ago
- Arab News
Can sanctions relief deliver quick wins for Syria's economy?
LONDON: Like a relic from another era, its promise long faded, the Syrian pound still lingers in the wallets of shopkeepers and shoppers in Damascus. Yet, green shoots of hope are sprouting across the war-weary nation. That rekindled sense of optimism owes much to US President Donald Trump's pledge to ease sanctions and signs of regional support for Syria's economic recovery. A major boost came on May 31, when Saudi Arabia and Qatar announced they would jointly fund salary support for Syrian state employees, many of whom have struggled for years on paltry and irregular wages. The pledge builds on earlier Gulf efforts to stabilize Syria's economy and signals a deeper commitment to reconstruction. On May 12, Saudi Arabia and Qatar settled Syria's $15.5 million in arrears to the World Bank's International Development Association — a key step that reopened access to loans and grants. The international backing comes at a crucial moment. After 14 years of war and isolation, Syria's economy has nearly collapsed. Exports have dried up, foreign reserves have fallen to just $200 million, the currency has lost 99 percent of its value, and more than 90 percent of Syrians live below the poverty line. Trump's March 13 announcement in Riyadh sparked spontaneous celebrations in the capital's streets. But even amid the jubilation, many Syrians recognized that true recovery would take more than a policy shift — and much longer to materialize. 'Partial sanctions relief sends a political signal, not a legal guarantee,' Harout Ekmanian, public international lawyer at Foley Hoag LLP in New York, told Arab News. 'Investors remain cautious, and there is a risk of overcompliance with any remaining sanctions that are in place, particularly in sensitive sectors like banking,' he said. He added that the need for 'a complete lifting of the tangled web of sanctions to facilitate investment from compliance sensitive investors from the US and Europe' cannot be overstated. Delaney Simon, a senior analyst with the International Crisis Group's US program, concurred. 'If Trump is actually planning to lift all or even most sanctions on Syria, he is doing something virtually unprecedented in the recent history of sanctions relief,' he told Arab News. He cautions, though, that 'lifting sanctions is not straightforward.' 'It will require a massive bureaucratic and possibly political lift in Washington, including mobilization of different arms of the US government including the Treasury, State and Commerce departments and Congress,' Simon said. Even with formal relief, private firms may be slow to re-engage. 'Relief on paper might not translate to relief in practice,' he said. 'The private sector may be wary of engaging with Syria once the restrictions are lifted.' Despite those concerns, Simon urges patience. 'President Trump has a tough road ahead to make good on this commitment, but he should persevere,' he said. 'He is right that lifting sanctions gives Syria a chance at greatness.' For now, such an outcome remains uncertain. The most severe Western sanctions were imposed in 2011 by the US, EU, UK, and others in response to the Assad regime's crackdown on protesters. Following the ousting of Bashar Assad in December, the new interim government, led by President Ahmad Al-Sharaa, inherited a damaged economy and the sanctions that helped undermine it. Washington's measures were among the most sweeping: a near-total trade embargo, asset freezes, and secondary sanctions targeting foreign firms doing business with Syria. The Caesar Act of 2020 imposed additional restrictions, further isolating Assad's regime. Signs of change came on May 23, when the US Treasury's Office of Foreign Assets Control issued General License 25, lifting most of those restrictions. The relief, however, comes with conditions: political reform, respect for human rights, and counterterrorism commitments from Damascus. Soon after, the EU and UK followed suit, underscoring a broader Western alignment with the Al-Sharaa government. Still, experts say sanctions relief alone will not revive an economy ravaged by years of conflict. A key next step is rejoining the SWIFT financial network. Bankers in Damascus expect the connection to be restored within weeks, enabling smoother international transactions and potentially unlocking billions in remittances from Syrians abroad. Nevertheless, global banks remain cautious, awaiting clearer legal guidance from Western governments. 'Syria's financial system is a black box that nobody understands,' Stephen Fallon, a banking and sanctions expert, told The Economist newsmagazine. 'If I run a Western bank and I accidentally receive funds from terrorists, it's me the American regulators will come after.' Foley Hoag's Ekmanian sees potential short-term gains but says they depend on legal clarity. 'Sanctions relief can act as a pressure valve by easing immediate economic distress, but without legal clarity on asset recovery and investor protections, quick wins may remain elusive,' he said. Access to frozen reserves could help stabilize liquidity. But long-term recovery, he added, depends on structural reform and investor confidence — both difficult to achieve. Syria's central bank holds just $200 million in foreign exchange reserves, Reuters news agency reported — a steep decline from the $18.5 billion the International Monetary Fund estimated before the war. It also retains nearly 26 tonnes of gold, currently valued at over $2.6 billion. The interim government hopes to unlock up to $400 million in frozen overseas assets to fund reforms, including recent salary hikes for public workers. But the actual value, location, and timeline for repatriation remain unclear. Switzerland has identified $118 million in local banks, according to Reuters, while The Syria Report estimates another $217 million is in the UK. Ekmanian emphasized that even modest gains 'hinge on the credibility of the sanctions relief architecture.' He noted that 'if businesses fear snapback sanctions or regulatory ambiguity, even the thawing of restrictions won't translate into meaningful economic movement.' Predictability, he said, underpins international investment. 'International investment law tells us that predictability is key,' he said. 'While sanctions relief can unlock trade routes and aid, without legal assurances and investment protection commitments, Syria risks a piecemeal recovery vulnerable to geopolitical shifts.' Beyond legal guarantees, Syria must overhaul its domestic institutions. 'Legal frameworks must catch up with policy signals,' Ekmanian said. 'Re-engagement with Syria under international economic law requires more than opening bank accounts,' he explained. 'It demands credible reforms to the domestic legal framework, judiciary, arbitration frameworks, debt transparency, and governance of sovereign assets.' He also warned of legal risks that could deter investors: a growing docket of war-related tort and atrocity litigation in European and US courts under universal jurisdiction and terrorism exceptions to sovereign immunity. 'Even with various US sanctions and EU Council Regulation 36/2012 partially relaxed, this needs to be accompanied by steps to ensure that the new government and Syrian people are not unduly burdened by the prior regime's liabilities,' he said. Ultimately, he said, 'modest sanctions relief can ease humanitarian transactions and marginally bolster foreign-exchange buffers, but it cannot deliver a durable uplift in trade, investment or debt restructuring without parallel movement on governance, transparency, and human-rights benchmarks that anchor international economic law.' Syria's external debt is another major obstacle, estimated by the new government to be between $20 billion and $23 billion — high relative to its 2023 GDP of about $17.5 billion. Much of it was accrued under Assad through military and oil-related loans from allies such as Iran and Russia, complicating restructuring efforts. Despite these hurdles, some see progress. 'US sanctions relief will be a major step not only towards economic recovery, but also towards ending the cycles of violence that have trapped Syria for over a decade,' said Nanar Hawach, a senior Syria analyst at the International Crisis Group. He argued that economic collapse has contributed to insecurity by weakening services, deepening grievances and driving recruitment into armed groups. 'Lifting sanctions could help reverse that dynamic,' he told Arab News. Syria's post-Assad transition remains unsettled. Renewed violence has erupted in several areas, including rural Damascus, Homs, and the Alawite-dominated coast, now largely controlled by HTS, the group that led the offensive to oust Assad. The group has since absorbed rival factions, some still having Daesh-aligned extremists in their ranks. Elsewhere, sectarian clashes have hit Homs and rural Damascus, while the interim government struggles to contain unrest among Druze in the south and Kurds in the northeast. Still, the psychological effect of sanctions relief may prove powerful. 'The most immediate benefit is psychological: a clear boost in investor confidence,' Hawach said. 'Even when sanctions were partially eased in the past, most banks and companies, especially international ones, avoided Syria out of fear of getting blacklisted,' he said. 'Simply put, the word 'Syria' was enough to trigger overcompliance,' but a shift is noticeable now. He noted that some regional investors are already engaging with Syria. 'Some have already taken the decision to invest and are now looking into the technical aspects of it,' he said. 'There's a lot of momentum. It's looking very promising.' Since May 13, several regional investors have announced major projects. On May 29, Syria signed a strategic agreement with a consortium led by Qatar's UCC Holding to build four gas power plants and a 1,000-megawatt solar facility — a $7 billion investment expected to meet over half the country's electricity needs. In another sign of momentum, DP World, the Dubai-based ports operator, signed an $800 million agreement to develop and expand the port of Tartus — the largest foreign investment in Syria since sanctions relief began. Diaspora entrepreneurs are also stepping in. Mohamed Ghazal, managing director of Startup Syria, a community-led initiative supporting Syrian entrepreneurs, says Syrian startup founders are targeting key sectors for recovery: infrastructure, public services, agriculture, digital services, and food security. 'These sectors can generate jobs quickly, particularly in construction, agriculture, and tech,' Ghazal told Arab News. He also cited healthcare, education, and fintech as areas for investment, especially given Syria's push to reconnect with global financial systems. 'Vocational training, online learning, digital health services — these are where youth and diaspora professionals can really contribute,' he said. As Syria begins its journey back into the international community, the road ahead is still rocky and the challenges daunting. Yet, for the first time in years, the nation appears to be moving toward a new era — one shaped not by conflict and sanctions, but by constructive diplomacy, reform and cautious optimism.
Al Arabiya
4 hours ago
- Al Arabiya
US withdraws hundreds of troops from Syria after Pentagon directive
Hundreds of American troops have been withdrawn from Syria, according to US officials, in line with US President Donald Trump's new approach to the region and as a direct result of the fall of the Assad regime. An estimated 500 troops were withdrawn in recent weeks, and multiple US bases were handed over to the Syrian Democratic Forces (SDF) or shut down, Fox News reported on Monday, citing US officials. Fox News also reported that Mission Support Site Green Village was shut down, while MSS Euphrates was handed over to the SDF. According to the officials who spoke to Fox News, a third base was also vacated. Sources familiar with the matter confirmed news to Al Arabiya English that a number of troops had been deployed elsewhere. Al Arabiya English has reached out to the Pentagon, the Joint Chiefs of Staff, and the US Central Command for comment. CENTCOM referred questions on the matter to Chief Pentagon Spokesman Sean Parnell's announcement of the consolidation of forces in April. That statement said the US would consolidate troops in Syria under Combined Joint Task Force – Operation Inherent Resolve to select locations in the country, bringing down the US footprint in Syria to less than 1,000. 'As this consolidation takes place, consistent with President Trump's commitment to peace through strength, US Central Command will remain poised to continue strikes against the remnants of ISIS in Syria,' Parnell said at the time. The United States has maintained a partnership with the SDF for several years, viewing it as crucial in the fight against ISIS. Despite having reservations about engaging with Syria's interim president, Ahmed al-Sharaa, the Trump administration has now lifted sanctions on Syria, paving the way for regional and international players to enter the Syrian market and help begin the path to recovery. Washington gave the Syrian government a list of conditions earlier this year. This included expelling foreign fighters from the country as well as removing foreign fighters from official military or government positions, preventing Iran and its proxies from reestablishing a foothold and others. But on Monday, Reuters reported that Washington had okayed a plan by Damascus to integrate foreign fighters into the army. Beyond Syria, the US has approximately 2,500 troops in Iraq, 3,500 in Jordan, and nearly 2,000 in Turkey. In a deal between Baghdad and the Biden administration, the US would consolidate its bases in Iraq and reduce the number of troops stationed there. However, after the fall of the Assad regime, Iraq has been pleading with the US to delay its transition. No decisions have been made yet, officials said.
Al Arabiya
6 hours ago
- Al Arabiya
Britain unveils radical defense overhaul to meet new threats
Britain said on Monday it would radically change its approach to defense to address threats from Russia, nuclear risks and cyber-attacks by investing in drones and digital warfare rather than relying on a much larger army to engage in modern combat. Responding to US President Donald Trump's insistence that Europe take more responsibility for its own security, Prime Minister Keir Starmer has pledged the largest sustained increase to UK defense spending since the end of the Cold War. But with limited finances, the government's plan envisages making the army more lethal, not larger, by learning from Ukraine where drones and technology have transformed the battlefield. Defense Secretary John Healey said Britain's adversaries were working more in alliance and technology was changing how war was fought: 'Drones now kill more people than traditional artillery in the war in Ukraine and whoever gets new technology into the hands of their armed forces the quickest will win.' Starmer commissioned a Strategic Defense Review shortly after he was elected last July, tasking experts including the former NATO boss, George Robertson, and a former Russia adviser to the White House, Fiona Hill, with formulating a plan for the next 10 years. Despite cuts to the military budget in recent years, Britain still ranks alongside France as one of Europe's leading military powers, with its army helping to protect NATO's eastern flank and its navy maintaining a presence in the Indo-Pacific. But the army, with 70,860 full-time trained soldiers, is the smallest since the Napoleonic era and the government has said it needs to be reformed given the growing strategic threats. New defense age Under the plan accepted by the government, Britain will expand its fleet of attack submarines which are nuclear-powered but carry conventional weapons, and will spend 15 billion pounds ($20.3 billion) before the next election due in 2029 on the replacement of the nuclear warheads for its main nuclear fleet. It will build at least six new munitions plants, procure up to 7,000 British-made long-range weapons, and launch new communication systems for the battlefield. A Cyber and Electromagnetic Command will lead defensive and offensive cyber capabilities, after UK military networks faced more than 90,000 'sub-threshold' attacks in the last two years. But on the size of the armed forces, the review said it would not reduce numbers, even as a greater emphasis is put on technology, but increasing the total number of regular personnel should be prioritized when funding allows, likely after 2029. 'The moment has arrived to transform how we defend ourselves,' Starmer told workers at BAE Systems' Govan shipbuilding site in Scotland, saying he would 'end the hollowing out of our armed forces.' 'When we are being directly threatened by states with advanced military forces, the most effective way to deter them is to be ready.' Starmer has already said defense spending will increase to 2.5 percent of GDP by 2027, from 2.3 percent, but critics and political opponents urged the government to put a date on when it would move to 3 percent of GDP. Reuters has previously reported that NATO Secretary General Mark Rutte wants members to raise defense spending to 3.5 percent of their GDP, and a further 1.5 percent on broader security-related items to meet Trump's demand for a 5 percent target. Starmer said he was '100 percent confident' that UK defense spending would hit 3 percent in the next parliament likely between 2029-2034 - something the review appeared to take into account when drafting its recommendations. The government described its policy as 'NATO first,' drawing on the strength of the alliance's members which meant it would never fight alone. Starmer has sought to cast the higher defense spending as a way to create jobs and wealth, as he juggles severely strained public finances, a slow-growing economy and declining popularity among an increasingly dissatisfied electorate. The announcement about new submarines helped lift the share prices of defense groups Babcock, BAE and Rolls Royce.
