The US has reignited fears of a global trade war after electing to move ahead with the imposition of controversial tariffs on steel and aluminum imports from the European Union, Canada and Mexico.
US president Donald Trump is facing significant anger from three key American allies after his administration chose to hit the regions with harsh new levies of 25 per cent on steel and ten per cent on aluminium.
These tariffs were announced as a global measure in March 2018, resulting in significant market disruption and a series of escalating tit-for-tat tariff threats between the US and China. Initially, the US agreed to exempt the EU, Canada and Mexico from the levies while discussions took place to identify other ways these regions could tackle their trade deficit with the US.
However, US commerce secretary Wilbur Ross has now decided that insufficient progress was being made through these talks, meaning the waiver has now been lifted. The decision has once again sent global markets into turmoil, and prompted threats of retaliatory action.
Canadian prime minister Justin Trudeau has issued an immediate like-for-like response, with tariffs of up to 25 per cent to be applied to US imports worth up to C$16.6 billion (€10.96 billion), or the total value of Canadian steel exports to the US last year. These tariffs will cover steel and aluminium, as well as orange juice, whiskey and other food products.
Meanwhile, Mexico will look to impose equivalent measures on a variety of products, including steel, pork, and various fruits and cheeses. The US's stance is also likely to jeopardize the progress of the current renegotiation of the North American Free Trade Agreement.
A similar response has been seen from the EU, with European leaders and ministers in individual EU states all expressing anger over this decision.
European Commission president Jean-Claude Juncker said: "The US now leaves us with no choice but to proceed with a WTO dispute settlement case and with the imposition of additional duties on a number of imports from the US. We will defend the union's interests, in full compliance with international trade law."
