Countries will need to make concessions in order to secure an exemption to US tariffs on steel and aluminum, top White House economic adviser Larry Kudlow said Thursday.
"Part of this is a negotiation," Kudlow said speaking on CNBC. "It's very important that some of our friends make concessions with respect to trading practices, tariffs and taxes."
The US on March 23 began implementing a 25% tariff on steel imports and a 10% tariff on aluminum imports following Section 232 investigations launched by the Department of Commerce last year on the effect these imports have on US national security. Temporary exemptions to the tariffs have been granted to a number of US allies, including Canada, Mexico, the EU, Argentina, Australia and Brazil; however, those are set to expire May 1.
When asked what will happen come May 1, Kudlow said everything is still under discussion.
"There were exclusions for a number of countries, but it's all under consideration now and we will know in a few days," he said.
One of the issues cropping up in negotiations is the equal treatment of automobiles, Kudlow said.
"That's no secret," he said. "We would like to see some concessions from Europe."
The US and South Korea in March reached an agreement to begin implementing a quota on steel imports in lieu of the tariffs, part of which included automotive trade. As part of the renegotiated US-Korea Free Trade Agreement, South Korea agreed to increase the amount of US autos is allows into the country, upping the annual cap to 50,000 vehicles per US auto manufacturer, up from 25,000 vehicles per manufacturer.
Rules of origin concerning automobiles also have been a focus of meetings this week between the US, Canada and Mexico regarding changes to the North American Free Trade Agreement, Canadian Foreign Minister Chrystia Freeland said Wednesday. Negotiations between the three countries continued Thursday,
Overall, the goal of the Section 232 tariffs is to get the US and its trading partners to a level playing field, Kudlow said.
"This program over time will be negotiated out," he said. "If it's not, the US and President Donald Trump will take action and those actions will be targeted tariffs."
