Washington [US], July 21 : US President Donald Trump has signed a proclamation under Section 232 of the Trade Expansion Act of 1962 to adjust aluminium imports, citing national security concerns and seeking to boost investment in the domestic aluminium industry, according to a White House statement.
The fact sheet said tariffs on imported aluminium were aimed at protecting the country's defence and defence-related industrial base.
It said, "aluminium is a key input for the production of US military systems, including armoured vehicles, naval vessels, spacecraft, and missiles, as well as other key strategic products."
These systems and their components rely on high-strength advanced aluminium alloys that can only be produced using primary aluminium. However, US demand for primary aluminium currently exceeds the production capacity of domestic smelting facilities. Thus, "This proclamation encourages increased reshoring of primary aluminium production," it said.
The Proclamation authorizes and directs the Secretary of Commerce to establish an incentive program for companies that will invest in building, expanding, or refurbishing aluminium smelters in the United States.
Hence, the proclamation seeks to encourage the reshoring of primary aluminium production and directs the Secretary of Commerce to establish an incentive programme for companies investing in the construction, expansion or refurbishment of aluminium smelters in the US.
"The program will request onshoring plans from companies that, if approved, will be eligible to import a commensurate level of primary aluminium into the United States at a reduced tariff rate equal to half of the otherwise applicable Section 232 rate.
As per the release, the Secretary will monitor and enforce approved onshoring plans and may suspend or rescind tariff benefits, including retroactively, if companies fail to meet their commitments.
"Since returning to office, President Trump has continued taking actions under Section 232 to protect and strengthen domestic manufacturing critical to our national and economic security, including imposing and strengthening tariffs on key goods such as steel, aluminium, copper, trucks, automobiles, timber, lumber, and pharmaceuticals," the release noted.
The White House further said in the release that the administration has attracted trillions of dollars in private and foreign investment through negotiations and strategic tariffs to boost US jobs and manufacturing, diversify global supply chains and reduce dependence on adversarial nations.