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Significance
Both are committed to tackling global overcapacity in steel and aluminium and to promoting sustainable production, but divergent views on China and trade regulatory mechanisms to oversee the new agreement are undermining progress. They are also negotiating the further suspension of US steel and aluminium tariffs on EU exporters.
Impacts
Washington is likely to offer the EU concessions on access to Inflation Reduction Act subsidies, but the economic benefits will be limited.
An agreement on a tariff-free green steel zone that excludes China would most likely result in Beijing imposing retaliatory trade measures.
Ongoing uncertainty and the prospect of a Donald Trump victory in 2024 risk undermining long-term industry confidence in EU-US trade.
Keywords:
EU,
United States,
EUR,
China,
WTO,
EU/US,
economy,
industry,
international relations,
politics,
foreign policy,
foreign trade,
government,
steel,
talks,
climate,
corporate,
regulation,
technology
© Oxford Analytica 2023. All rights reserved. This content contains general information about geopolitical, macroeconomic and social developments or (where stated) other matters. It does not contain advice or recommendations that may be relied on. Where links to external websites are provided, this does not indicate that Oxford Analytica or Emerald agree with, endorse or have checked for accuracy the contents of said sites.
2023
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