UK steel industry welcomes withdrawal of steel tariffs but warns against further measures

The UK steel industry has welcomed today’s announcement by President Bush that the section 201 tariffs on steel imports are being withdrawn.
Commenting on the announcement, Ian Rodgers, Director of UK Steel, said:

"The President has at last bowed to the inevitable as the tariffs were neither legal or necessary and were extremely destructive, provoking a wave of protectionism in other countries. Despite what President Bush says, the tariffs were not necessary to help US restructuring. The consolidation in the US industry that has enabled this restructuring was already underway before the tariffs were imposed, and was dictated by market forces, not by protectionism."

Praising the role of the European Commission and British government, Ian Rodgers added:

"I have absolutely no doubt that the President has only been forced into taking this decision by the certain knowledge that if the tariffs had remained in place beyond 10th December, he would have faced EU sanctions on €2.4 billion of US exports."

UK Steel however remains concerned that the Bush announcement says nothing about the proposal known as "layering". The US Commerce Department has opened formal consultations on a proposal to make technical changes to the way anti-dumping duties are calculated, which would mean that such duties are substantially increased for sales that were subject to the section 201 tariffs.

"If enacted, this change would negate the today’s decision, by extending the life of the tariffs through the back door. It would be an open invitation to the US steel industry to file new anti-dumping cases, because by moving the goal posts it would guarantee that all sales made during the time of the tariffs were also classified as "dumped". We urge the Commission to keep its threat of retaliation active until it is confirmed that the US government will not introduce "layering" said Mr Rodgers.

ENDS

Notes for editors

Tariffs of up to 30% were imposed by the USA in March 2002 on imports of a large number of steel products. Much of what the UK steel industry sells to the USA is high value, specialist products for niche markets, and companies have successfully argued to get these excluded from the tariffs. The tariffs have however been highly disruptive in terms of their overall effect on world trade.

The EU has a Regulation still in place entitling it to impose trade sanctions on US trade worth €2.4 billion five days after the WTO’s Dispute Settlement Body formally adopts the ruling that the tariffs were WTO-illegal. This was due to take place on 10th December. They would have been applied to imports ranging from orange juice to clothing.

UK Steel, a division of EEF, is the voice for the UK steel industry. It represents around 95% of UK steel producers and further processors.

EEF, the manufacturers' organisation, has a membership of around 6,000 manufacturing, engineering and technology-based businesses and represents members' interests at all levels of government and within the wider policy community. Comprising 12 regional Associations, the Engineering Construction Industries Association (ECIA) and UK Steel Division, EEF is one of the UK's leading providers of business services in health, safety and environment, employment relations and employment law, world class performance, education, training and skills.

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