ARI SHAPIRO, HOST:
When President Trump announced new tariffs on steel and aluminum imports yesterday, he teased the idea of giving certain countries exemptions. The only countries he named were Canada and Mexico. But members of the 28-nation European Union hope the president will include them, too. Joining us now is the EU's ambassador to the U.S., David O'Sullivan. Ambassador O'Sullivan, welcome to the program.
DAVID O'SULLIVAN: Thank you, nice to be here.
SHAPIRO: There's a high-level meeting tomorrow in Brussels between representatives of the EU and the United States about these tariffs. What is the European Union's message for this meeting?
O'SULLIVAN: Well, coincidentally, the meeting tomorrow between Ambassador Lighthizer, Cecilia Malmstrom, who's the European Union trade negotiator, and their Japanese counterpart, Minister Seiko, was actually organized a few weeks ago to have a discussion about a joint or a trilateral approach to the issue of Chinese overcapacity in steel, which is a common problem.
SHAPIRO: So you agree that China has been engaging in...
O'SULLIVAN: Absolutely. We have also suffered from this, as have our Japanese colleagues, and we've been discussing with the administration for some time the need for joint action. So we were somewhat surprised that when this issue of tariffs came - on steel came forward that somehow it was the European Union and Canada and Mexico and other countries who are not part of the problem who seemed particularly targeted. So...
SHAPIRO: And I imagine further surprised when President Trump yesterday announced that Canada and Mexico would be exempted but did not say the same about the EU.
O'SULLIVAN: Well, I think that was because Canada and Mexico are engaged in negotiations with the United States through NAFTA. We are not in such a negotiation. There is apparently a possibility for other exemptions. And we hope that Ambassador Lighthizer will be able to shed some light on that tomorrow and give us some idea of how this process might work. We don't have a lot of time. There's only 15 days to go before these tariffs potentially kick in. So we're anxious to understand what the process is and how it might work.
SHAPIRO: So it sounds like you're not yet in adversarial mode, still in diplomatic mode.
O'SULLIVAN: Look, we don't think these tariffs are justified. We feel unfairly targeted by them. We have announced that if they were to kick in, we would feel justified to take rebalancing measures against certain American exports. But America is a friend, an ally, a partner. We would rather not be there. So we're always going to be listening for off-ramps or ways of avoiding this becoming a confrontation, which is absolutely not what we want.
SHAPIRO: Rebalancing measures sounds like a very diplomatic term for a very unpleasant situation.
O'SULLIVAN: It's a state-of-the-art language from the WTO. You're right. It's a - but it's - it basically would allow us to impose tariffs on certain American exports in order to compensate for what we feel would be unfair tariffs on ours. But this is not where we want to be with the United States and not on this issue because we actually have a lot in common with the administration on this issue, particularly visibly the role of China. So we hope that the discussions in Brussels tomorrow will show us a path forward that we can de-escalate this issue and move on to address the real problem, which is Chinese overcapacity.
SHAPIRO: If the U.S. were to impose these tariffs on imports of steel and aluminum from the European Union, what would the impact on European countries be?
O'SULLIVAN: Well, we are actually the largest exporter of steel to the United States in value terms, the second largest after Canada in volume terms. This would affect exports worth about $8 billion. And many, many of the companies concerned are companies producing small niche products, which are not made in the United States. So it would have a dampening effect on our exporters. And that is why we would feel the need to engage in some rebalancing with other tariffs if this were to happen. But, I repeat, we are very much in the mood of hoping that we can find a way out of this short of reciprocal tariffs from both sides.
SHAPIRO: Just in our last 30 seconds or so, many people have looked at Donald Trump's interactions with Europe and said he treats his allies like adversaries and his adversaries like allies. Do you think this has larger consequences for the U.S.-EU relationship?
O'SULLIVAN: We have a very firm relationship. We've had conflicts of this kind in the past over trade issues. I think we can compartmentalize them and not forget the bigger picture of what binds us together in a very strong partnership and alliance, so we will continue to do that.
SHAPIRO: Ambassador O'Sullivan, thanks for coming into the studio today.
O'SULLIVAN: Thank you very much.
SHAPIRO: Ambassador David O'Sullivan is the European Union's ambassador to the United States. Transcript provided by NPR, Copyright NPR.
