In an effort to give the U.S. steel industry the chance to adapt to the large influx of foreign steel, President George W. Bush has announced a three-year tariff on steel imports. The plan includes tariff safeguards of as much as 30 percent on major steel products. (White House press office, other industry sources .)
'I take this action to give our domestic steel industry an opportunity to adjust to surges in foreign imports, recognizing the harm from 50 years of foreign government intervention in the global steel market, which has resulted in bankruptcies, serious dislocation and job loss,' said Bush. 'We also must continue to urge our trading partners to eliminate global inefficient excess capacity and market-distorting practices, such as subsidies.'
Foreign steel producers, often nurtured by government subsidies that have allowed the companies to build huge amounts of excess capacity, have flooded the U.S. market with imports, seriously affecting the U.S. steel market. Since 1998, firms accounting for thirty percent of U.S. steel-making capacity have filed for bankruptcy. Domestic steel prices in the last quarter of 2001 were at their lowest levels in 20 years.
'This safeguard remedy gives American steel industry some temporary relief of import surges and unfair trading practices that have hurt its ability to compete and to prosper,' said U.S. Trade Representative Robert Zoellick. 'Yet this safeguard only offers an opportunity that the steel industry and its workers will need to seize. They need to use this breathing space to restructure and to regain competitiveness. We'll also monitor and review how the industry uses this period of adjustment to restructure and improve productivity. And we can adjust the safeguards, if conditions warrant.'
The tariffs do not include free-trade partners Canada, Israel, Jordan and Mexico, as well as those from developing nations in the World Trade Organization with a small share in the market.
Components of steel tariff
* Flat products -- A tariff of 30 percent will be imposed on imports of plate, hot-rolled sheet, cold-rolled sheet and coated sheet.
* Tin mill products -- A tariff of 30 percent will be imposed on imports of tin mill products.
* Hot-rolled bar and cold-finished Bar -- A tariff of 30 percent will be imposed on imports of hot-rolled bar and cold-finished bar.
* Rebar -- A tariff of 15 percent will be imposed on imports of rebar.
* Certain tubular products -- A tariff of 15 percent will be imposed on imports of certain welded tubular products.
* Carbon and alloy fittings and flanges -- A tariff of 13 percent will be imposed on imports of carbon and alloy fittings and flanges.
* Stainless steel bar -- A tariff of 15 percent will be imposed on imports of stainless steel bar.
* Stainless steel rod -- A tariff of 15 percent will be imposed on imports of stainless steel rod.
* Stainless steel wire -- A tariff of 8 percent will be imposed on imports of stainless steel wire.
For more information on the steel tariffs, visit www.whitehouse.gov.