October 16, 2018 / 10:04 AM / a month ago

Escalating trade tensions will create 'only losers' - Voestalpine CEO

TOKYO (Reuters) - No country would benefit from any escalation in global trade tensions that were fuelled by the United States’ push this year to impose tariffs, the head of Austrian steelmaker Voestalpine AG (VOES.VI) said on Tuesday.

“If we build up trade barriers, there will be only losers,” Chief Executive Wolfgang Eder told Reuters on the sidelines of the World Steel Association’s general assembly in Tokyo.

Citing Section 232 of U.S. trade law, which allows for tariffs on national security grounds, the Trump administration imposed global tariffs of 25 percent on steel imports and 10 percent on aluminium in March, sparking similar retaliatory responses from its trade partners.

The United States and China have since engaged in a tit-for-tat tariff war covering hundreds of billions of dollars of goods traded between the world’s two largest economies.

“Until we came to the U.S. Section 232 tariffs and similar protectionism moves by others, the global situation was well-balanced. But that’s being questioned now,” said Eder.

“We should do all (we can) to bring back the standard which we had before,” he said, adding the world has moved in the right direction by developing a fair trade system over the past two decades.

Voestalpine said last week that Washington has granted more than half of the exemptions to its steel import tariffs that the company and its customers applied for.

“We have not gotten answers to all of the applications, with some of big ones still being unanswered,” Eder said. “So we can’t comment on the final outcome.”

Eder said it was not right for countries to build trade barriers and ask companies to apply for exemptions.

“What we should aim for is to have as much free trade as possible,” he said.

Reporting by Yuka Obayashi; Editing by Manolo Serapio Jr.

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