A key clause in the U.S.-U.K. agreement to ease tariffs on British steel and aluminum sends a warning to China about its policy of subsidizing producers, President Joe Biden’s commerce chief said.
The agreement announced Tuesday, which will allow steel up to a certain level to be imported into the U.S. duty-free, includes a provision that any British steel company owned by a Chinese entity must undergo an audit of financial records to assess influence from China’s government and share the results with the U.S.
“This deal is a very strong signal to China that the U.S. and U.K. are committed to pushing back against China’s anti-competitive practices,” Raimondo said.
China is the world’s largest consumer and producer of steel and aluminum, accounting for more than half of the entire global markets.
The Trump administration imposed a 25% steel tariff, along with a 10% duty on aluminum imports, in March 2018 on a range of nations, using a national-security provision in a 1962 trade law. The European Union and the U.S. in October brokered a deal for Washington to ease those tariffs, but the tariffs remained on the U.K. due to the nation’s exit from the bloc.
The U.S. also reached a similar accord with Japan in February.
The deal with the U.K. also provides an important lift for American companies that use steel and aluminum as inputs at a time of high inflation, Raimondo said.
Firms “consume steel and aluminum, prices are high, and this is a good thing for the supply chain,” Raimondo said.
