US Seek Steel Imports Restriction

President George W. Bush asked the International Trade Commission (ITC) to probe the effect of the imported steel on the US steel industry.

If the US starts to curb steel imports in order to protect the battered US steel companies, Korea will be hard hit by the US`s action because Korea has much depended the exports of the steel-related products on the US.

The Korea government has tried to establish the two-pronged countermeasures. While the government will move against the US`s action jointly with Japan, the EU, etc., it will dispatch a trade delegation in order to block the possible trade conflict between Korea and the US.

President Bush said in the meeting with Senators at the White House that ``I am deeply concerned that the trade practices of the foreign steel producers have unfairly damaged the American steel industry. Hence, I asked the ITC to investigate under section 201 of the 1974 trade act, all steel products imported to the US.``

If the ITC finds out that the American steelmakers have damaged from the foreign companies`s dumping sales, it will propose the government to take such measures as the increase of the customs and the restriction of the imported amount. And the government will decide to take a `safeguard` measure for the steel imports based on the ITC`s proposal.

Presently, the market shares by country in the US imported-steel market are as follows; the EU (25 percent), Canada (19 percent), Japan (11 percent), Mexico (8.2 percent), Korea (7.1 percent), and Russia (3 percent).

The US steel companies have requested the government to take a restriction measure for anti-dumping, maintaining that ``the US steel industry has suffered from the 18 bankruptcies and 20,000 job losses since 1998 due to the cheap overseas steel.``

On the other side, however, the US carmakers have opposed to the increase of customs and the restriction of steel imports, worrying the increase of steel price.

Meanwhile, the Korean government is planning to dispatch a delegation to the steel committee of the OECD which will be held at Shanghai, China from 9th to 11th, and to the workshop of the international steel market. The delegation will point out the unfairness of the US`s steel imports restrictions.

And the government will tackle the US`s action to restrict steel imports jointly with Japan and the EU, and will file a lawsuit to the WTO in case that the US actually takes a restriction measure.

The Korean government is planning to send to the US, a large-scale trade delegation, which is comprised of Chang Chae-Shik Minister of Commerce, Industry and Energy, and 50 members selected from the related government departments and the steel companies during 24th and 28th. A trade delegation is supposed to explain to the officials of the US government the Korea`s position about the current trade issues between two countries. The representatives of the companies will have a meeting with the US steelmakers.

And the Ministry of Foreign Affairs and Trade will have a meeting for the examination of the current trade issues in order to accelerate the dialogue with the government in the middle of this month in Seoul, and is pursuing the plan to hold the 15th Korea-US Economic Council in Seoul soon.

Kim Sang-Chul sckim007@donga.com