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February 8, 2021

While Court Upholds Section 232 Tariffs, Biden Administration Says UAE Must Pay Aluminum Duties

As Connecting the Dots reported two weeks ago, in a last minute move before leaving office, President Donald Trump exempted companies in the United Arab Emirates (UAE) from his administration’s Section 232 duties on aluminum products.

Last Wednesday, President Joe Biden reversed that order. President Biden said, “[T]he available evidence indicates that imports from the UAE may still displace domestic production, and thereby threaten to impair our national security.” His predecessor’s exemption for the UAE had been set to take effect on February 3, 2021.

As Bloomberg noted the UAE sold $1.3 billion worth of the metal to American buyers in 2019. T

here were two other developments last week related to the Section 232 tariffs:

  • As Reuters reported, the U.S. Court of International Trade upheld the Section 232 tariffs on steel imports on Thursday, denying a steel importer’s challenge to the duties. The three judge panel said federal law clearly “grants the president latitude in evaluating whether imports threaten the national security” and “the statutory language makes clear that the list of factors to be considered in determining whether a threat exists is nonexclusive.”
  • The American Metals Supply Chain Institute (AMSCI) asked President Biden to completely eliminate the Section 232 tariffs. According to FastmarketsAMM (subscription required), AMSCI chairman John Foster argued in a letter to President Biden that, in today’s de-centralized global marketplace, the measures result in “economic animus, confusion and costly bureaucratic micromanagement of the economy.”

MSCI is reporting this development for its members information only.

As a reminder, MSCI consistently has argued that global overcapacity and other unfair trading practices, particularly by China, have harmed the U.S. steel and aluminum markets. To address this circumvention, in 2017 MSCI advised federal officials to provide relief for producers up and down the supply chain and to consider consequences of any new trade policy, including: the economic impact of global overcapacity on the entire domestic metals supply chain; transition times and implementation rules to any new policy; availability of domestic metals to meet U.S. national security needs, as well as general industrial and consumer demand; and trade flows under current free trade agreements, including the United States Mexico Canada Agreement (USMCA). MSCI also asked that Canada and Mexico be excluded from any trade penalties.

Click here  to review all of MSCI’s advocacy on Section 232 tariffs.