'Source of Pressure'? UK Urges US Not to Mix Up Post-Brexit Issues With Steel Tariffs

The talks between the US and UK over the removal of Trump-era steel tariffs stalled in November. A recent report by the Financial Times suggested that the reason for that could be the Biden administration's discontent with the UK's approach to post-Brexit trade squabbles with the EU.

The United Kingdom has warned the United States against conflating the issue of post-Brexit trade squabbles between London and Brussel and the recently stalled talks over ditching the American tariffs on UK steel.

The Financial Times reported on Wednesday that the Biden administration halted the negotiations due to Congress' pressure over Whitewall's Northern Ireland Protocol threats. Earlier, London mulled invoking Article 16 of the Northern Ireland Protocol (which allows suspending parts of the Brexit agreement) in the event of the UK-EU trade difficulties continuing.

Many have already viewed the reported American stance as an attempt to interfere in the post-Brexit trade spat.

“It might be true in terms of how some people in the United States feel, but it is a false narrative,” UK Trade Minister Penny Mordaunt told Parliament on the issue. “These are two entirely separate issues."

The tariffs on UK steel were dubbed by Boris Johnson's government "damaging," with the PM's spokesperson telling reporters that Downing Street is "working closely with the Biden administration" to remove them.

Mordaunt was not the only one to voice concern about the US trying to leverage the trade situation between the UK and EU. Shadow International Trade Secretary Nick Thomas-Symonds recalled that Washington agreed to remove the "punitive tariffs" on steel and aluminium exports for the EU more than a month ago but left them in place for London.

"Whatever the explanation for that difference in treatment, it is unacceptable for it to continue, and the government must get this situation resolved," he said. "The UK steel and aluminium industries should not be a pawn in anyone's political games when there are jobs and businesses at stake in communities across our country."

The criticism of Washington's "interference" appears to be bipartisan; the Labour party, according to Sky News, slammed the US move as "unacceptable" and are joined in their condemnation by the UK steelmakers.

"On 1 January, steelmakers in the EU will gain a significant price advantage over their UK counterparts," Director-General of industry body UK Steel Gareth Stace said, cited by Sky News. "Already, customers in the United States will be factoring in January 2022 prices to their plans for the next year, which of course risks the UK sector losing market share in the US, to EU exporters.

He revealed that after the tariffs were imposed, the UK exports to the US have declined from 350,000 tonnes in 2018 to 200,000 tonnes in 2020.

"While many of our US customers have stood by us, it is imperative that all parties work together to come to an agreement that provides the UK with the same tariff-free quotas the EU has already secured, and that such an agreement is arrived at as soon as possible", Stace insisted.

The move by the United States to delay the lifting of the tariffs as a response to the UK's approach in the post-Brexit trade spat has also worried Director of the UK Trade Policy Project David Henig.

"US uses steel tariffs as source of pressure on UK over Northern Ireland Protocol threats", he tweeted after the FT report emerged. "No, that isn't how world trade should work. Yes, it is how world trade is increasingly working."

US uses steel tariffs as source of pressure on UK over Northern Ireland Protocol threats.

No, that isn't how world trade should work.
Yes, it is how world trade is increasingly working.

UK government always seems dazed by real power politics. https://t.co/LE5Rv19Zgs

— David Henig (@DavidHenigUK) December 1, 2021

The steel tariffs for the European Union were introduced by former US President Donald Trump in 2018, but his successor Joe Biden lifted them for the bloc in October. However, they remain in place for the United Kingdom, since it exited the EU in 2020.

Trump said back at the time that the steel tariffs (25 percent on steel and 10 percent on aluminium) were imposed to protect the American steelmakers, claiming that the EU was "taking advantage of us economically." The bloc, along with the United Kingdom, was united in blasting the tariffs as "patently absurd" and "no way to treat your friend."

Loyalists opposed to the Northern Ireland Protocol protest in Newtownards town centre, Northern Ireland, Friday, June 18, 2021.

© AP Photo / Peter Morrison

Announcing "a new era of transatlantic cooperation," Biden ended the Trump-era tariffs, also underling that the ditching of these tariffs will do well not only for the American workers and the US relations with allies but also for the climate.

Apparently left out of the "new era," the United Kingdom has kept the retaliatory measures on US bourbon whiskey and other products that were imposed back during the Trump era. London also remains at odds with Brussels over post-Brexit trade rules, with the Northern Ireland issue not making it easier. Under the Northern Ireland protocol, the region remains in the EU's single market for goods – something that allows no hard border between Northern Ireland and the Republic of Ireland, but increases hardships for goods crossing the Irish Sea into Northern Ireland.

Article 16 of the Protocol, which the UK threatened to invoke, can be used by both sides of the Brexit agreement if they see “serious economic, societal or environmental difficulties” or the “diversion of trade.” It would also halt checks on travelling to Northern Ireland from the rest of Britain.