The US and UK have entered formal negotiations over Trump-era tariffs on UK steel and aluminum exports.
Trade officials from both countries said they were determined to get a “quick result” that would help preserve metal makers in both markets.
The trade dispute has long been a thorn in relations between the two allies.
Last year, the United States reached an agreement to remove border taxes on European shipments of metals.
Under the Trump administration, the United States imposed a 25% tariff on foreign steel and a 15% tax on foreign aluminum, sparking a firestorm of criticism – especially from allies , including the United Kingdom, which imposed tariffs on certain American products, such as whisky, in retaliation.
The United States has since lifted some of the measures, which were supported by many American steelmakers.
Under President Joe Biden, he struck a deal with Europe and began negotiations on the issue with Japan.
But UK exporters continue to face border taxes.
A British steel exporter has already declared that it is transferring its production to Spain in this way. United Cast Bar Limited told the BBC it was unlikely the production would be returned to the UK once it was moved unless a deal was struck very quickly with the US.
In a statement announcing the start of the talks, UK and US trade officials said: “Both sides are committed to working towards an early outcome that ensures the viability of the steel and aluminum industries in both markets. face the continuing common challenge of global excess capacity and strengthen their democratic alliance.
The statement follows a virtual meeting of UK Secretary of State for International Trade Anne-Marie Trevelyan, US Trade Secretary Gina M. Raimondo and US Trade Representative Katherine Tai.
Ms Trevelyan described Wednesday’s meeting as ‘productive’ and said ‘we want a resolution as soon as possible which supports UK business and further strengthens our trading relationship’.
The UK steel lobby welcomed the news. He said existing tariffs had reduced UK exports by almost 50%.
“That within weeks of the start of 2022 a resolution appears to be in sight is great news for the steel industry and steelworkers in the UK,” UK Steel said.
“Given the competitive disadvantage created by the EU deal, it is essential that these talks are concluded quickly to limit any further harm to UK producers.”
The industry body added that it hoped the UK would be able to secure an even better deal with the US than with the EU, as it “takes full advantage of its new independent commercial powers”.
The US and UK statement also accused China of overproduction of metals – which they said had created “distortions which … pose a serious threat to the steel and iron industries. market-oriented aluminum in the UK and the US, and to workers in these industries”.
They said the talks aimed to find a way to partner “to promote high standards, address common concerns and hold countries that practice harmful market-distorting policies to account.”
After that ministerial meeting, talks between British and American officials begin on Thursday and the British side is keen for them to progress apace and be concluded in weeks, not months.
The joint declaration gives them something to work on. It blames global overcapacity in the steel and aluminum industries “largely” on China, and says the resulting distortion is a problem for businesses and workers in the UK and in the USA.
Neither side wants their business dispute to escalate, so pointing the finger at a rival third party is one solution.
UK steel companies are also desperate to have the 25% tariffs on their exports lifted as soon as possible – it puts them at a significant competitive disadvantage compared to their EU counterparts.
But there are other political considerations. Washington remains concerned about entirely separate negotiations on Northern Ireland between the UK and the EU, and British threats to suspend parts of the Northern Ireland Protocol.
In other words, if the Northern Ireland talks take a negative turn, it will certainly not help to resolve the steel dispute.
It will therefore be interesting to see if the Americans share the British desire to fix this problem in a few weeks. If they do, it will be good news in London. If they don’t, the pressure on the UK government to step up its retaliatory measures will intensify.