On Friday The White House announced that countries, including Japan, and the European Union have 180 days to negotiate agreement with the U.S., to avoid a 25 percent tariff on foreign cars imported to the U.S..
According to the White House an investigation conducted by the Secretary of Commerce found “that automotive research and development (R&D) is critical to national security,” they added, “in light of the report’s findings, the Secretary recommended actions to adjust automotive imports so that they will not threaten to impair the national security.”
The Washington Post reported Friday that “many outside the administration have criticized the linkage of cars with national security, saying that view of national security is overly broad, and pointing out that the bulk of American auto imports come from the country’s closest allies.”
As the article notes, the delay in imposing auto tariffs offers a reprieve to the global market which “had been bracing for punishing tariffs on the more than 8 million cars imported into the United States each year.”
Senator Chuck Grassley (R-IA) said that while he is glad there has been a pause, he is simply not a fan using national security to implement tariffs on foreign autos.
As the president knows, I’m not a fan of tariffs. And I have serious questions about the legitimacy of using national security as a basis to impose tariffs on cars and car partsGrassley via the Washington Post.
EU Trade Commissioner Cecilia Malmstrom responded to the delay via Twitter.
We note that US postpones decision on car tariffs for 180 days. But we completely reject the notion that our car exports are a national security threat. The EU is prepared to negotiate a limited trade agreement incl cars, but not WTO-illegal managed trade.— Cecilia Malmström (@MalmstromEU) May 17, 2019
Will discuss with USTR Lighthizer next week in Paris and with Trade Ministers on 27 May.— Cecilia Malmström (@MalmstromEU) May 17, 2019
In related tariff news, lost among the noise of the Flynn document drop, the White House announced Thursday plans to adjust imports of Steel, Bloomberg reported on Friday the adjustment according to sources is to “lift steel and aluminum tariffs on Canada and Mexico in favor of stronger enforcement actions.”
According to Bloomberg the tariffs are “expected to be lifted about 48 hours after an official announcement, which will likely be made as early as Friday. In return, Canada and Mexico will eliminate their retaliatory tariffs, the people said.”
As the News Blender reported President Trump has increased Tariffs on $200 billion worth of Chinese goods. The increase from 10 percent to 25 percent, plus the threat of finding more products to tariff prompted companies such as Walmart to announce the intent to raise consumer prices on products.