EU Steel Tariff Hike Sparks "Biggest Crisis" for UK Industry Amid EU Proposal to Cut Imports

EU Steel Tariff Hike Threatens 'Biggest Crisis' for UK Industry BRUSSELS (Reuters) - The European Union's plan to hike tariffs on imported steel has sent shockwaves through the UK industry, with some calling it "perhaps the biggest crisis" it has ever faced. The EU's proposal aims to cut the amount of steel that can be imported into the bloc by half, beyond which a 50% tariff will apply. The commission's decision comes after pressure from member states and their steel industries, struggling to compete with cheap imports from countries like China and Turkey. "We have global over capacity, unfair competition, state aid, and undercutting in prices," said Stéphane Séjourné, the European Commission's executive vice-president for a Europe fit for the Digital Age. "And we are reacting to that." The EU is the UK's most important export destination for steel, worth nearly £3 billion and representing 78% of steel products made in the UK for overseas markets. The commission has set out plans to reduce tariff-free quotas for imports to 18.3 million tonnes a year, a 47% reduction from 2024 levels. The new measures will come into force early next year, pending approval by the majority of EU member states and the European Parliament. Industry leaders have expressed concerns about the impact on UK businesses, with some warning of potential job losses and factory closures. "This is perhaps the biggest crisis we've faced in the industry," said Gareth Stace, director general of the UK Steel Association. "The tariffs will make our products more expensive for EU customers, which could lead to a significant decline in demand." Background research suggests that global steel production has been plagued by overcapacity and unfair trade practices, with some countries providing state aid to their domestic industries. The EU's decision aims to address these issues and protect its own industry. Additional perspectives come from the International Trade Union Confederation (ITUC), which has expressed concerns about the impact on workers in both the UK and EU. "The tariffs will lead to job losses, factory closures, and a decline in living standards for thousands of workers," said Sharan Burrow, ITUC general secretary. The current status is that the proposal is still pending approval, with industry leaders urging EU policymakers to reconsider their decision. The next development will be the vote on the proposal by EU member states and the European Parliament in early 2024. As the global steel market continues to grapple with overcapacity and unfair trade practices, the EU's decision has sent a clear message: protecting domestic industries is a top priority. But for UK businesses, the impact of these tariffs remains uncertain, and only time will tell if this crisis can be averted. *Reporting by Bbc.*