Sawt Falasteen - EU eyes higher steel tariffs, taking page from US

Brussels will unveil new measures next week to protect the steel sector that will replace a current "safeguard clause" expiring next year, Sejourne said during a meeting in Brussels, participants told AFP.

Protecting the steel industry is a priority for Brussels, especially after US President Donald Trump slapped 50 percent tariffs on the metal this year.

The European Commission will propose the changes to prevent a wave of cheap steel flooding the EU market following Washington's new levies, as well as Canada's higher tariffs on Chinese imports.

The EU agreed a tariff deal with the United States in July but failed to get Trump to lower duties on European steel, although European officials remain hopeful for future agreement on the issue.

The EU executive currently has safeguard measures -- including import limits -- that will continue until 2026 and seek to shield the industry from Asian overcapacity.

The EU's current tariff rate on steel imports is 25 percent once the quota volume is exceeded.

Now Sejourne said Brussels wants to reduce its foreign steel quotas by almost half and raise duties to levels similar to the EU's "American and Canadian partners".

The proposals, once approved, will not be temporary, he said.

- EU-US cooperation hopes -

European manufacturers have seen their margins collapse, faced with the influx of large quantities of steel from China into Europe.

Industry data shows China was responsible for more than half of the world's steel production last year.

Adding insult to injury, European steelmakers' costs have also risen due to soaring energy prices on the continent.

The European steel industry currently employs around 300,000 people -- but has lost almost 100,000 jobs in the past 15 years.

The EU has already taken extra measures to reinforce the current safeguards including cutting steel imports by a further 15 percent from April this year.

Although the EU-US tariff deal this summer did not include steel, Brussels hopes both sides can agree to jointly protect their markets, especially from China.

"We are discussing with our American partners a kind of ringfencing model where we would, between us, trade on the TRQ (tariff-rate quotas) with very low or zero tariffs," EU trade chief Maros Sefcovic said this week.

Brussels hopes its new measures will then lead to more fruitful talks with Washington on a "metals alliance" to counter China's excess capacity.

Canada in July announced plans to slap an additional 25 percent tariff on steel imports that contain steel melted and poured in China.

Sejourne will present the commission's proposal at the European Parliament in Strasbourg, France, on Tuesday.

T.Ibrahim--SF-PST