U.S. Considers Steel Tariff rollback in Exchange for EU Digital Policy Concessions
WASHINGTON – The Biden governance is weighing a reduction in U.S. steel adn aluminum tariffs as part of a broader trade negotiation with the European Union,according to sources familiar with the discussions. The potential move, spearheaded by U.S. Secretary of Commerce Gina Raimondo, is linked to securing commitments from Brussels on digital trade regulations, including data privacy and competition policy.
The emerging deal aims to resolve a long-standing dispute stemming from tariffs imposed by the Trump administration in 2018 on steel and aluminum imports from the EU, citing national security concerns. While a foundational agreement on trade has been in place for months, details surrounding the implementation of a joint declaration made in August remain contested. The core of the current negotiations centers on reciprocal concessions: lowered tariffs from the U.S. in exchange for the EU easing restrictions on cross-border data flows and addressing concerns over the dominance of large tech companies.
In August, president Biden and European Commission President Ursula von der Leyen reached a preliminary understanding to establish a 15 percent tariff rate on most EU imports to the U.S.,a significant reduction from previously considered levels. As part of that agreement, von der Leyen pledged the EU would increase its purchases of U.S. energy, targeting $750 billion in acquisitions by the end of the Trump administration’s term-a commitment the EU is actively working to fulfill. EU Trade Commissioner Valdis Dombrovskis reported in late 2023 that strategic energy purchases, encompassing liquefied natural gas (LNG), nuclear energy, and oil, had already reached $200 billion. The U.S.share of the EU’s LNG imports rose from 45 percent to 60 percent during the same period.Furthermore, EU investments in the U.S. have increased to approximately €150 billion since January 2023.
The proposed tariff reductions on steel and aluminum would offer relief to European producers and perhaps lower costs for U.S.manufacturers who rely on these materials. Though, the move is highly likely to face scrutiny from domestic steelmakers and unions who argue that maintaining tariffs is crucial for protecting American jobs and national security. The outcome of the negotiations will have significant implications for transatlantic trade relations and the future of digital regulation globally.