USA willing to ditch steel tax
US President George Bush may end tariffs on steel imports as early as this week. The move is widely expected following a World Trade Organisation ruling that the tariffs violated international trade laws.
US President George Bush may end tariffs on steel imports as early as this week. The move is widely expected following a World Trade Organisation ruling that the tariffs violated international trade laws. The European Union as well as Far Eastern countries have been threatening to retaliate by mid-December on the US $2.2 billion of American steel exports if Washington refused to repeal them.
The tariffs were originally imposed by the Bush administration because American steel manufacturers were too inefficient to compete with global competitors. The tariffs were always designed as a temporary measure to give the US industry time to restructure and increase its competitiveness.
Not all restrictions will be lifted on exports to the US. To soften the blow to US steel makers, the Bush administration is considering keeping a steel import licensing and monitoring system in place, several industry sources said.
The system requires US businesses that import steel products to obtain a license. Advocates call it an early warning system against potential surges in steel imports.
US steel producers have been urging the White House to make the system permanent regardless of what the president decides to do with the steel tariffs. “What we’re saying is use this to gauge whether or not there is a surge coming. This just gives our government the ability to act proactively to prevent a downward spiral in pricing,” said Dan DiMicco, chief executive of Nucor Corp., the largest steel producer in the United States, in an interview with LA Times.
He said the licensing and monitoring system was similar to those in Europe, Latin America and Asia and did not run afoul of WTO rules.
Steel importers said that the system might cause more harm than good but signaled that they would not oppose it.