The United States’ attempt to build a protective ringfence around its steel industry has resulted in a policy with no clear walls, creating a broad and unpredictable tariff zone that is ensnaring European allies. The expansion to “derivative” products has blurred the boundaries of the trade dispute, making it unclear who and what is being targeted.
The original policy was clear: high tariffs on imported steel and aluminum. This was a ringfence with defined parameters. However, the subsequent inclusion of products that merely contain these metals has effectively demolished those walls, allowing the tariffs to spill out and affect a vast range of other industries.
The current list of 407 derivative categories is a testament to this lack of boundaries, covering everything from industrial machinery to household goods. With a new review in progress, European businesses fear that this tariff zone is about to expand even further into uncharted territory.
This boundlessness is the source of the chaos. As Luisa Santos of BusinessEurope noted, the constant expansion makes it impossible for businesses to find “certainty.” They are operating in a trade landscape where the borders can be redrawn at any moment.
The paradox is that in trying to build a ringfence for its own industry, the US has created an open and hazardous field for its trading partners. The lack of clear walls in its policy is forcing European industries to call for the construction of their own defensive barriers in response.
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