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EU officials have announced plans to match Donald Trump's steel tariffs, increasing to double taxes on imports to 50% in a decision condemned as "a survival risk" to the sector in the UK.

Major Challenge for British Steel Exports

Given that 80% of UK steel shipments destined for the European Union, this change poses the British steel sector's most severe challenge, as stated by the lobby group representing the industry.

New EU Measures and Regulations

Through its proposal submitted to the EU legislature this week, the EU executive additionally suggested cutting the existing quota for tariff-exempt steel and requiring foreign suppliers to declare the origin of steel production to prevent China sneaking products in through third nations.

EU steel sector faced potential collapse – these measures safeguard it so that it can invest, reduce emissions, and regain competitiveness.

Replacement of Existing System

The proposals are designed to supersede a import framework that has been functioning for the last seven years and which is due to expire in 2026 and is now seen as ineffective. Inaction could have been "fatal" for the industry, one EU official said.

Industry Response and Warnings

However, Gareth Stace, head of the industry body UK Steel, stated EU doubling its tariffs would pose "the most severe challenge the UK steel industry has encountered".

There were calls for the government to "acknowledge the urgent need to implement its own measures to defend" the British steel sector – which is still reeling from a twenty-five percent tariff from Trump recently – from the threat of millions of tonnes of world steel diverted away from American and EU markets.

This surge in foreign steel "might prove fatal for many of our remaining steel companies.

Labor and Government Pressure

Alasdair McDiarmid, assistant general secretary at labor union Community, said the proposed changes posed "an existential threat" to UK steel.

Labor and business representatives called on Keir Starmer to start negotiations immediately with the EU on country-specific tariff exemptions, pointing out that the United Kingdom was now the European Union's No 1 trading partner.

Industry Background

Sector representatives in the EU have repeatedly cautioned for several months that the European steel sector faces being "wiped out" through the increased duties on American market shipments combined with high energy costs and cheap Chinese competition.

The steel industry on in both the UK and EU is considered a essential sector, providing basic materials in everything from skyscraper structures, wind turbines and railways to household appliances and cutlery.

Implementation and Future Actions

These proposals must be agreed by member states and the European parliament, with the EU executive head calling on national governments and European parliament members to act fast in support of the proposal.

If the plan is ratified, the European Union will reduce its existing tariff-free allowance by 47% to 18.3 million tons a year, a volume previously recorded in 2013. It will apply a 50% tariff on foreign steel beyond the quota and oblige nations shipping to the bloc to state the production origin to prevent circumvention of the sanctions.

Exemptions and International Cooperation

These European nations will not be subject to import limits or duties because of their strong economic ties in the European Economic Area, the European Union has confirmed.

In addition to these measures, the European Union is seeking a "steel partnership" with the US to ringfence their national industries from overcapacity.

EU needs to act now, and decisively, before operations cease in large parts of the EU steel industry and its supply networks.