Countries warn of economic fallout from Trump’s steel tariffs

Countries across the world are reacting to President Donald Trump’s announcement that all imports of steel and aluminium to the US will be taxed at a minimum of 25%.

Trump on Monday removed the exceptions and exemptions from his 2018 tariffs on steel and also hiked his 2018 aluminium tariffs to 25% from 10%.

European Union leaders have vowed the tariffs “will not go unanswered” and will be met with tough countermeasures, while Canadian Prime Minister Justin Trudeau said Canadians will “stand up strongly and firmly” against the hike.

“Canadian steel and aluminium is used in a number of key American industries, whether it’s defence, shipbuilding, manufacturing, energy, automotive. Together we make North America more competitive. We will be working with the American administration over the coming weeks to highlight the negative impacts on Americans and Canadians of these unacceptable tariffs,” Trudeau told reporters at an AI summit in Paris.

Trudeau added that the two countries should be “doing more together not fighting each other” and that the tariffs were “unjustified” on America’s closest ally.

Mexico strongly opposes new tariffs

Mexico’s Economy Secretary, Marco Ebrard, has also strongly opposed the new tariffs, emphasising that Mexico imports more steel from the US than it exports.

While steel imports from the US have increased in the past two years, exports of Mexican steel to the US have decreased.

He also pointed out that the US enjoys a trade surplus with Mexico in terms of steel and aluminium.

Ebrard announced that Mexico would present this data to the Trump administration, appealing for “common sense” in handling trade relations.

“This, as President Trump sometimes says, is about common sense. Well, we take him at his word: let’s have common sense; not shoot ourselves in the foot. Don’t destroy what we have built over the last 40 years,” Ebrard said at a joint press conference with Mexican President Claudia Sheinbaum.

Economic experts in Brazil echoed Mexico’s warnings, saying the tariffs will increase costs for Americans, as the US is not self-sufficient in steel and aluminium production.

“What is known is that immediately this increases the cost of the American production, to the extent that they are not self-sufficient in the production of these products (steel and aluminium). And everything made from these raw materials will become more expensive for the American people themselves. So, it’s quite feasible to imagine that there could be room for some degree of conversation. But all this is speculation at the moment,” said Gilberto Braga, a professor at Brazil’s IBMEC Institute.

Local councilman Raone Ferreira has also said the production chain of the national steel company, which has a factory in Volta Redonda, generates about 40,000 direct and indirect jobs.

The local politician warned of potential consequences as a result of the new tariffs.

“If the impact in the steel production is confirmed, the impact on the generation of employment in the municipality would be enormous, and also on public policies,” he said.

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Ferreira explained that the city’s municipality depends on direct and indirect revenues from the national steel company to carry out education, mobility and health projects.”

Brazil is a major exporter of steel and aluminium to the US, and in 2024 was the second largest supplier behind Canada, according to the US department of commerce.

Japan asks to be exempt from the tariffs

Meanwhile, Japan’s Chief Cabinet Secretary, Hayashi Yoshimasa, says his government has sent a request to be exempt from the tariffs via the Japanese embassy in the US.

“We will take firm and necessary measures while closely monitoring details and any possible impact (on Japan),” Yoshimasa told reporters at a news conference in Tokyo.

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President Trump announced on Wednesday he plans to reset US taxes on all imports to match the same levels charged by other countries reacting to his tariffs.

“It’s time to be reciprocal,” Trump told reporters earlier this week. “You’ll be hearing that word a lot. Reciprocal. If they charge us, we charge them.”