Donald Trump’s administration has decided to delay the imposition of tariffs to European Union, Canada and Mexico until June 1, 2018.
Until then, the negotiation will continue to try to avoid the tariffs that initially were announced by Donald Trump administration of being 25% on steel and 10% on aluminium.
Donald Trump’s administration first decision was that these tariffs would be imposed in order to guarantee the United States’ security.
When Donald Trump announced the decision to impose tariffs to importations on steel and on aluminium, on March 23, 2018, there was a temporary exception to some countries: European Union, Mexico, Canada, Australia, Brazil and Argentina.
This decision on increasing tariffs to some products by Donald Trump’s administration, has one explication:
United States’ balance of trade (BOT), was negative in $502 billions in 2016.
Donald Trump thinks that only a little improvement in this trade balance, would be beneficial to United States’ industries and for his country in general.
On July 25, 2018, United States and European Union agreed to work towards a zero tariffs scenario.
On October 1, 2018, Donald Trump announced that a new trade deal between United States, Canada and Mexico, (USMCA) that replaces the NAFTA agreement (almost 25 years old). This agreement benefits workers, companies of these three countries.
BALANCE OF TRADE (BOT)
The balance of trade (BOT) is the difference between the imports and exports of a country, for a given period.
A country that exports more products that imports has a balance of trade positive.
If a country imports more than exports has a negative balance of trade.
So we can think that having a good balance of trade indicates the health of a country’s economy.
Well, that’s not plenty true, because there are another factors that influence, such the business cycle and other economical indicators.
For example, United States, as we have seen before, has a negative Balance of Trade. Has a bad economical health?
I don’t think so.
United states has a trade deficit due to his important of oil and consumer products.
China has a positive balance since 1995 because it has a lot of exports.
VISIT of 2 EUROPEAN LEADERS
World Trade is a very sensitive issue as 2 leaders of the European Union probably said to Donald Trump in their visit to the White House last week. So decisions may be taken very carefully, to no affect both companies and consumers.
These 2 leaders were Emmanuel Macron, President of France, and the Chancellor of Germany, Mrs. Angela Merckel.
You can see an article about the visit of Mr. Macron to the White House.
Both have had conversations with British prime minister, Mrs Theresa May, a country also affected by the possible imposition of tariffs to steel and aluminium by United States.
The other country specially affected by the United States administration decision to impose tariffs to some products is China, to where members of Donald Trump’s administration travel this week to try to find an agreement.
To avoid the fake news i recommend you look at official websites like the White House official website.
If you like economic information you can read the article about U.S. intellectual property in this web.
If you like international relations you can read the article A more peaceful world also in this web.
You can also read the article about Donald Trump’s presidency in this web.