America’s main trading partners have reacted angrily to President Donald Trump’s plans to impose tariffs on steel and aluminium imports.
Canada and the European Union said they would bring forward their own counter-measures to the steep new tariffs.
Mexico, China and Brazil have also said they were weighing up retaliatory steps.
Mr Trump tweeted that the US had been “decimated by unfair trade and bad policy”. He said steel imports would face a 25 percent tariff and aluminium 10 percent.
However, critics argue that the tariffs would fail to protect American jobs and would ultimately put up prices for consumers.
The news sent shares in Asia down on Friday, with Japan’s benchmark Nikkei 225 losing more than 2 percent by mid-morning.
Shares in Japan’s car-making giant Toyota were down more than 2 percent and Nippon Steel stocks down more than 4 percent.
Toyota said the US decision would “adversely impact automakers, the automotive supplier community and consumers”.
What has the political reaction been?
European Commission President Jean-Claude Juncker said the tariffs would put thousands of European jobs at risk.
“We will not sit idly while our industry is hit with unfair measures,” he said. “The EU will react firmly and commensurately to defend our interests.”
In Canada, the largest supplier of steel and aluminium to the US, trade minister Francois-Philippe Champagne said any tariffs would be “unacceptable”.
Minister of Foreign Affairs Chrystia Freeland said Canada would take “responsive measures” if restrictions were imposed but did not give details.
Australia’s trade minister Steven Ciobo said the imposition of such tariffs would distort trade “and ultimately… lead to a loss of jobs.”
Brazil, also a large steel exporter to the US, threatened “multilateral or bilateral” action to protect its interests, while Germany’s steel industry federation said the measures violated the rules of the World Trade Organization and would have a major impact on Germany’s its market.
A senior Invercargill city councillor said the proposed new US tariffs were not expected to affect the aluminium smelter south of the city.
Councillor Darren Ludlow said most of Tiwai Point’s exports went to markets other than the US.
He said the announcement was of no immediate concern for Invercargill, though it might limit available export markets.
A spokesperson for New Zealand’s aluminium smelter said less than 2 percent of the aluminium produced at Tiwai Point was exported to the US, with most going to the Asia-Pacific market.
How has China reacted?
The country which produces more than half the world’s steel gave no immediate official response but there had already been indications it would consider some sort of retaliation.
Li Xinchuang, vice-secretary-general of the China Iron and Steel Association, said the impact on China would not be big, adding: “Nothing can be done about Trump. We are already numb to him.”
Little Chinese steel directly reaches US ports, Reuters news agency notes, because of previous anti-dumping duties, designed to prevent countries from selling their products at prices deemed unfairly low.
But US steel industry executives said Chinese steel was still widely shipped to the US through third countries.
President Xi Jinping’s top economic adviser, Liu He, met the Trump administration on Thursday for “frank and constructive” talks, a White House official said.
What did Trump say?
Mr Trump pledged to rebuild the US steel and aluminium industries which he said had suffered “disgraceful” treatment from other countries, in particular China, for decades.
“When our country can’t make aluminium and steel… you almost don’t have much of a country,” he said.
“We need great steel makers, great aluminium makers for defence.”
Since taking office Mr Trump has said cheap imports from China are harming the viability of industry in the US.
How does the US steel industry shape up?
The US imports four times more steel than it exports and is reliant on steel from more than 100 nations.
The US Department of Energy said the steel industry was recovering after a slump following the 2008 financial crisis.
But it is an industry significantly weaker than it was at the turn of the millennium. In 2000 the US produced 112m tons of steel – a figure that had fallen to 86.5m tons in 2016.
In 2000, 135,000 people were employed in the industry – a figure that fell to 83,600 in 2016.
– BBC/ RNZ