United States President Donald Trump has imposed 25 percent tariffs on all steel and aluminium imports as part of his efforts to overhaul the international trading system, which he believes unfairly disadvantages US manufacturers and workers.
By signing executive orders to implement the tariffs on Monday, Trump expressed his concern that American industry has been negatively affected by both allies and adversaries.
“Our country needs steel and aluminium to be produced in the United States, not in other countries. We must create in order to protect the future of our nation,” Trump stated during the signing of the orders.
“It’s time for our industries to return to America. We want them back in America. This is just the beginning.”
Trump confirmed that the tariffs, which he had mentioned the previous day, will apply to all countries without any exemptions or exceptions.
“This is a significant step,” Trump emphasized. “This is the start of making America prosperous again.”
These new tariffs, set to take effect on March 4, are likely to provoke retaliatory measures from affected countries, including some of the United States’ closest allies, potentially leading to multiple trade conflicts.
In 2024, the US imported around $49 billion worth of steel and aluminium, according to government data.
Canada was the largest supplier of steel, followed by Mexico, Brazil, South Korea, Germany, and Japan. Canada was also the top exporter of aluminium, with other major suppliers including the United Arab Emirates, South Korea, and China.
Trump’s announcement immediately sparked opposition in Canada.
“Trump is trying to provoke us. But we must remain united and respond appropriately,” stated Mark Carney, a potential successor to Canadian Prime Minister Justin Trudeau as leader of the Liberal Party.
Trump is also expected to announce reciprocal tariffs on countries that impose tariffs on US goods this week, on top of the 10 percent tariff on Chinese goods that recently went into effect and the 25 percent tariffs on Canadian and Mexican imports that were temporarily suspended until March 1.
Economists have cautioned that Trump’s broad tariffs could lead to higher prices for US consumers and trigger a series of escalating trade disputes that may hinder global economic growth.
The Tax Foundation estimates that Trump’s tariffs in 2018 and 2019 resulted in a 0.2 percent decrease in GDP. They also predict that the proposed tariffs on Mexico, Canada, and China may shrink economic output by 0.4 percent and increase taxes by $1.1 trillion between 2025 and 2034.
Michael Stanaitis, a trade expert at the American University, believes that the impact of Trump’s tariffs will be significant.
“Unless exemptions are granted to US importers, consumers can expect higher prices and production shortages, particularly in industries like the US auto sector, which heavily relies on foreign inputs,” Stanaitis commented.
Trump had previously imposed a 25 percent tariff on steel and a 10 percent tariff on aluminium imports from most countries in 2018.
While he initially exempted several US allies, he later extended the tariffs to the European Union, Canada, and Mexico. In 2019, agreements were reached to exempt exports from Canada, Mexico, Australia, and Argentina.
Despite stating that no exemptions would be granted this time, Trump mentioned that he would consider excluding Australia from the measures given their surplus trade relationship.
Stanaitis believes that Trump’s latest tariffs will create tension among US trade partners and could lead to a movement toward trade liberalization among those partners.
