U.S. President Donald Trump has threatened to escalate the ongoing global trade war by imposing additional tariffs on European Union goods. In response, key U.S. trade partners have vowed to retaliate against the trade barriers already put in place by his administration.
The new tariffs on imported metals took effect on Wednesday, imposing a 25% duty on steel and aluminum imports, with no exemptions granted to any country. The measures also extend to hundreds of metal-based products, including nuts, bolts, bulldozer blades, and soda cans.
Within hours of the announcement, the European Union responded with $28 billion in retaliatory tariffs set to take effect at the beginning of next month. Meanwhile, Canada is considering countermeasures of its own. Speaking in Houston, Texas, Energy Minister Jonathan Wilkinson hinted at potential restrictions on oil exports to the U.S. or the imposition of export duties on energy, minerals, and other products. Canada currently supplies the U.S. with approximately four million barrels of imported oil per day. Wilkinson also mentioned a possible levy on U.S. ethanol as another option.
Australia, which had hoped for an exemption from the tariffs, expressed disappointment over the decision. Prime Minister Anthony Albanese, however, ruled out retaliatory tariffs, warning that trade conflicts would only harm economic growth and lead to higher inflation.
Other major economies, including Brazil, Mexico, and South Korea, are also expected to take a hit from the new tariffs. Despite the backlash, the U.S. Steel Industry Association has welcomed the move, claiming it will boost domestic production.