Bush Risks Trade War Over Steel Tariff

Home>>World

Last updated at: (Beijing Time) Wednesday, March 06, 2002

Bush Risks Trade War Over Steel Tariff

The United States was at loggerheads with its key war allies Tuesday after imposing tariffs of up to 30 per cent on steel imports, threatening a damaging trade dispute.

DISCUSSION

CHINESE

SEND TO FRIEND

The United States was at loggerheads with its key war allies Tuesday after imposing tariffs of up to 30 per cent on steel imports, threatening a damaging trade dispute.

The Bush Administration said that it was justified in acting to protect the ailing US steel industry. Thirty-one American steel firms have gone bankrupt in the past four years. The industry blames the decline on the unchecked influx of cheap foreign steel.

European Union leaders vowed swift retaliation and gave warning that the global economy would suffer. Romano Prodi, President of the European Commission, told President Bush before the announcement Tuesday that steps would have to be taken in response.

Pascal Lamy, the EU Trade Commissioner, said last night: "The EU will launch an immediate complaint against this clear violation of World Trade Organisation (WTO) rules and we will take whatever measures are necessary to safeguard our own market."

He feared that the American move would end any hope of finding an internationally agreed solution at the Organisation for Economic Co-operation and Development to overcapacity problems in the world steel industry.

Tony Blair had also protested to Mr Bush before the announcement was made, saying that tariffs would affect American consumers, a point conceded by Don Evans, the US Commerce Secretary, who admitted that domestic prices would rise.

Patricia Hewitt, the Trade and Industry Secretary, later expressed disappointment that the President had not been dissuaded from the move. She denounced it as wholly unjustified and said the Government would work with the EU to launch a complaint with the WTO to safeguard British steelworkers.

Japan, another key US ally, also said that it was ready to file a protest with the WTO. Russia took the threat to its steel exports so seriously that Alexander Vershbow, the US Ambassador to Moscow, was summoned and told by Foreign Ministry officials that tariffs could have a serious impact in the atmosphere of Russian-American relations.

Questions?Comments? Click here

Bush Vows to Continue US Mission in Afghanistan

U.S. Upset by Russian Poultry Ban