UAE seeks exemption from U.S. tariffs on steel, aluminum: government official

[March 20, 2018]   By Tom Arnold and Stanley Carvalho

ABU DHABI (Reuters) - The United Arab Emirates is asking Washington to exempt it from new U.S. tariffs on aluminum and steel and believes it has a strong case, a senior government official said on Tuesday.

U.S. President Donald Trump is pressing ahead with imposing import tariffs of 25 percent on steel and 10 percent on aluminum, but has already exempted neighboring Canada and Mexico and offered to exclude allies.

The UAE is the third-largest exporter of aluminum to the United States, after China and Russia, and also sells its steel there.

Juma al-Kait, assistant undersecretary for foreign trade affairs at the UAE economy ministry, told Reuters that officials were speaking with members of the U.S. administration.

"There's open dialogue with the U.S government ... We think we have a strong case to be exempt. Demand in the U.S market is high for high quality aluminum," said Kait

"We want to make clear that our exports are in fair competition with the market and are in line with international trade agreements on free trade,” he added.

Although the tariffs have not been officially notified to the World Trade Organization, Trump has justified the tariffs by invoking a “national security” clause under Section 232 of the 1962 U.S. Trade Expansion Act, the first time it has been used since the WTO was created in 1995.

A worker welds steel plates at the Dubai Dry Docks workshop, June 28, 2006. REUTERS/ Regi Varghese

The UAE is investing billions of dollars in industry, tourism and infrastructure to diversify its economy away from oil. Emirates Global Aluminium is the third-largest producer of primary aluminum outside China. The United States accounts for 5 percent of total sales for Emirates Steel, the largest steel producer in the UAE.

The UAE is one of the United States' largest export markets in the Middle East, with Emirates and Etihad Airways big buyers of Boeing aircraft and the government a large purchaser of U.S. defense equipment.

Danny Sebright, the president of the Washington DC-based U.S.-UAE Business Council, has been quoted in local media as saying the UAE could have room for negotiation on the tariffs because of the importance of its aluminum to U.S. aircraft manufacturing.

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