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May 2, 2018 6:54 pm | FILED UNDER: business

Steelmakers Discouraged By Trump’s Protectionist Tariffs

By ČTK

Prague, May 2 (CTK) – The extension of the EU’s temporary exemption from US tariffs on aluminium and steel imports by one month is a disappointment for Czech steelmakers, Confederation of Industry spokeswoman Eva Velickova told CTK today.

 

Any customs measures imposed by the USA on the EU make no sense and can only lead to a global trade war, Velickova said.

 

“We believe that the reason will eventually win and that the USA and the EU will arrive at an agreement that will minimise damage on both sides,” Chamber of Commerce analyst Karina Kubelkova said.

 

The current uncertainty is very unpleasant for companies, as they cannot make plans and manage their investments. In addition, the issue does not concern only steelmakers, since the biggest impacts of the USA’s measures will be the indirect ones, Kubelkova said.

 

“They (the measures) have the potential to affect small and medium-sized enterprises as well. There is a danger that the USA’s steps in the area of customs duties will lead to a global rise of fuel prices, which would affect all sectors of our economy,” Kubelkova said.

 

Czech steelmakers supplied products worth EUR200m (Kc4.2bn) to the USA in 2017, Velickova noted.

 

Companies now fear not only that Czech exports will be restricted but also that steel from third countries will be redirected from the US market to the EU market, which plays a more important role for Czech steelmakers, according to Velickova.

 

According to consulting firm Deloitte, the duties on aluminium and steel will have a negative impact on Czech production in the amount of Kc3.6bn. In terms of value added, the impact will be worth Kc970m (0.02 pct of GDP).

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