Views: 10 Author: Site Editor Publish Time: 2018-09-07 Origin: Site
On March 1, 2018 Trump announced his intention to impose a 25% tariff on steel and a 10% tariff on aluminum imports.
The origin of steel products in the United States is mainly concentrated in four states:
Indiana contributed 27% of its crude steel output.
Ohio subsequently contributed 12% of its output.
Michigan and Pennsylvania produced 6% crude steel respectively.
The crude steel output of these four states has exceeded half of the total output of the United States. Among them, Pennsylvania, Ohio and Michigan, the three traditional Democrats to help Trump to take the presidency to stand on the sweat.
One of the reasons they voted for Trump was to hope that when Trump was elected he would use trade protections to protect their traditional industries, such as steel. Trump, in order to retain Republican advantage in the House of Representatives for re-election and in the 2018 mid-term elections, is bound to take protective measures to meet the needs of voters.
Why did the international community and financial markets react so much to the trade of steel and aluminum?
First of all, the United States is the world's largest importer of steel, according to global steel trade monitoring statistics, in 2016 the United States imported about 30 million tons of steel, accounting for 7% of the world's total steel trade, far exceeding the second and third largest imports of Germany and South Korea. So although the United States is not the main producer in the steel market, but it plays an important role in the international steel market.
Second, the United States imports steel from more than 110 countries, mainly from Canada, Brazil, South Korea, Mexico, Russia, Turkey, Japan, Taiwan, Germany and India, all over the world.
Third, in the name of "national security", the U.S. Department of Commerce has taken protective measures against the import of steel and aluminum. It is open to all or major importing countries. It is not like "anti-dumping and anti-subsidy" that it is generally aimed at a special product and a special country, nor does it need to find a substitute country to calculate the dumping and subsidy quota. It is easy to cause reprisals from trading partners.
As a result, international markets are worried that the United States will ignite global protectionism, and uncertainty in trade policy will seriously threaten the recovery of Global trade that has just begun in 2017.
Who is the biggest benefit winner in this trade war ?
Producers and workers of the steel and aluminum industry in the United States will be the beneficiaries of this tariff increase. The production, employment and profits of major U.S. steel and aluminium producers will improve as tariffs rise and stock prices rise.
Who is the biggest victim?
If the United States imposes high tariffs on steel and aluminium, the major importers of steel and aluminium, the downstream industries and consumers of steel and aluminium in the United States, will suffer.
The U.S. steel market is particularly important to Canada, Mexico and Brazil because their main steel destinations are the United States. For example, in the 2016 years, the United States accounted for 88%, 73% and 34% of steel exports from Canada, Mexico and Brazil, respectively. If Trump really imposed a 25% import tariff on steel, it would have dealt a heavy blow to steel exports from the three countries. So these countries are particularly sensitive and responsive to the import tariff measures of the United States.
Sections of this article have been taken from en.wikipedia.org/wiki/2018_China%E2%80%93United_States_trade_war