Dr Liam Fox labels steel tariff extension as 'protectionist' and warns of retaliatory measures

Mon 4 Jul 2022
Posted by: Phillip Adnett
Trade News

Former international trade secretary Dr Liam Fox has labelled the decision to extend tariffs on steel imports as “one of this government’s worst decisions”.

Fox said the decision by current trade minister Anne-Marie Trevelyan was “protectionist” and would lead to retaliatory measure that would harm British trade.

Fox speaks out

Writing in the Telegraph, Fox said the protective measures would help a few UK producers, but harm other areas of the economy.

“South Korea, with whom Britain has trade worth £13.3 billion, is unlikely to stand by and watch its steel exports restricted without imposing measures of its own,” he said.

Possible products affected

Fox said Scotch whisky industry, cashmere, ceramics, folding bikes and the car industry could all be targets.

He proposed that the government look instead at addressing soaring electricity prices that he said were 84% above the median price in the EU for large industrial users.

Tariffs announcement

The government announced a two-year extension of tariffs on steel imports last week despite admitting that the move “departs from our international legal obligations” under the World Trade Organisation (WTO).

The move received a mostly positive domestic reception, but some in government have raised fears of retaliatory measures being imposed by foreign governments on other UK products while also harming manufacturers who rely on steel.

‘National interest’

Following Brexit, the UK rolled over EU quotas and tariffs on 10 categories of steel until mid-2024. The government has now decided to extend temporary safeguards on five other categories, according to the Independent.

Trevelyan said the national interest “requires action to be taken which may be in tension with normal rules and procedures”.

Changing guidance

The Trade Remedies Authority, the UK’s trade watchdog, originally said an extension of the tariffs was not justifiable, before it changed its guidance after the Department for International Trade adjusted the parameters of its probe.

The decision means that steel industries in countries such as China, Turkey, South Korea and India will face further barriers on their UK exports, reports City AM.

Boris Johnson last year backed Fox as a candidate to become director-general of the WTO, but the bid was unsuccessful.