Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
Reactions continue to pour in following U.S. President Donald Trump’s imposition of 25 per cent tariffs on steel imports and 10 per cent for aluminium for almost every country but Mexico and Canada.
Today, German Economy Minister Brigitte Zypries told Reuters that the decision will cost jobs and growth. According to Zypries, Trump does not want to understand the architecture of a free global economy which, in her view, is based on a rule-based system of open markets.
As Europe accounts for nearly 5 million tonnes of the 35 million tonnes of steel the U.S. imports every year, the bloc is hopeful that its members would be exempt from the tariffs. If not, officials have said that they would consider asking the World Trade Organization to impose its own measures.
The German minister emphasized that if such countermeasures are needed, the EU should continue to operate as a collective and avoid being divided by Trump’s offer to exempt some allies.
On Saturday, Europe’s trade chief Cecilia Malmstrom met with U.S. trade envoy Robert Lighthizer in Brussels to discuss the topic. Following the encounter, Malmstrom said that there is still no clarity on the exemption procedure. Talks will continue next week.
European Trade Commissioner Cecilia Malmstrom in Stockholm.
Photo by GFMD/Mikael Sjöberg. Taken from Malmstrom’s Facebook page.
Japanese Trade Minister Hiroshige Seko was at the same meeting and asked Lighthizer for a “calm-headed behaviour.” Talking to reporters afterward, Seko did not go into what conditions might allow Japan to evade the tariffs but he did say that once the impacts of the levies on Japanese businesses are assessed, his government would make a final decision as to whether or not bring up the issue before the WTO.
According to Reuters, Seko, Lighthizer and Malmstrom did agree on joint steps to tackle global steel overcapacity and distorted market practices, including stronger rules on subsidies and more sharing of information about market abuse.
In a more dramatic tone, China’s Commerce Minister Zhong Shan said on Sunday that any trade war with the United States will only bring disaster to the world economy.
With his words, Beijing stepped up its criticism on the proposed metals tariffs by Washington. Shan said that his country can handle any challenge that comes its way and will resolutely protect its interests, but he vowed to keep the conversation going.
Not everyone in China has been as moderate, though. On Friday, the Iron and Steel Association urged for the government to retaliate by targeting U.S. coal – a sector that is central to Trump’s political base.
China, together with Japan, South Korea and India, accounted for 6.6 million tonnes of steel imports to the U.S.in 2017.
In the Middle East, Sohar Aluminium, which is jointly owned by Oman Oil Company, Abu Dhabi National Energy Company and Rio Tinto and is one of the largest producers of the metal in the region, said that it may feel some knock-on effect from Trump’s tariffs.
In an email statement to Reuters, CFO Jerry Van Alphen explained that even though the company will not be directly impacted as it does not currently have any direct exports to the U.S., if other Gulf Cooperation Council producers who do ship to America change their marketing strategies and impact regional markets, then the Omani giant would be affected.
Comments
Walter H. Eason, Jr.
Have to love their up side down thinking. We import their goods for free and they charge other goods we export with a tariff. Yes I am sure they like that idea just like many of them enable human trafficking and parts of the country where the police can go into to protect their citizenry. Pray to God that we never get there although there are some here in this country want to enable the same. We must actively support all legislators who support the Constitution of the United States of America. We should all find a way to actively reject and denounce all others who would tear down the use of the Constitution of the United States of America.