THE European Union (EU) and Japan urged the United States on Saturday to grant them exemptions from metal import tariffs, with Tokyo calling for “calm-headed behavior” in a dispute that threatens to spiral into a trade war.

U.S. President Donald Trump, who holds executive power to impose tariffs of 25 percent on steel imports and 10 percent on aluminum, at the outset granted exemptions to Canada and Mexico, and said there would be the possibility of industry exemptions, although he has not been specific.

After Trump opened the door for exemptions, Brazil, Japan, South Korea, Australia and Europe clamored for special treatment, while Chinese producers called on the government to retaliate in kind.

Trump tweeted Friday that he spoke with Australian Prime Minister Malcolm Turnbull about trade and military cooperation. “Working very quickly on a security agreement so we don’t have to impose steel or aluminum tariffs on our ally, the great nation of Australia!” Trump said.

Treasury Secretary Steven Mnuchin earlier said he expects countries in addition to Mexico and Canada to be exempted in the next couple of weeks.

After meetings with U.S. trade envoy Robert Lighthizer in Brussels, EU and Japanese trade officials said negotiations would need to continue.

Europe’s trade chief Cecilia Malmstrom described talks with Lighthizer as “frank” and said they had not brought clarity on the exemption procedure. Talks would continue this week.

“As a close security and trade partner of the United States, the EU must be excluded from the announced measures,” she tweeted after bilateral and trilateral meetings.

Japanese Trade Minister Hiroshige Seko said he had expressed Japanese concern to Lighthizer and warned of major market disruption.

“We call for calm-headed behavior,” he told reporters.

Seko did not go into what conditions might allow Japan to evade tariffs and, asked if Lighthizer had brought up the U.S. trade deficit with Japan, Seko said no.

“He only explained the schedule and the procedures,” he said.

Any Japanese response, he said, would be in line with World Trade Organization rules: “If there is a violation, then we will seek consultations,” Seko said. “We will look at the impact on Japanese businesses and make a final decision.”

The European Union and Japan, the United States’ top economic and military ally in Asia, also reiterated that their exports were not a threat to U.S. national security, rejecting Trump’s justification for imposing the tariffs.

The European Commission, which coordinates trade policy for the 28-nation EU, the world’s biggest trading bloc, has said it is ready to impose safeguards, tariffs or quotas to protect its own steel and aluminum industries from products diverted to Europe because of the U.S. measures.

It has already started monitoring incoming metal flows to see whether a surge will occur.

(SD-Agencies)