U.S. Steel Companies Demand 40 Percent Tariffs

U.S. steel firms and steelworkers proposed the U.S. International Trade Commission (ITC) to take a strong safeguard such as import tariffs of 40 percent under `Section 201`.

Following that the U.S. Trade Representative (USTR) changed its position to support the decision of the ITC, the U.S.`s steel industry circles also began to take a pressing action against other countries, which might bring about `a steel conflict` between the U.S. and the steel exporting countries.

According to the U.S. steel firms and the U.S. government yesterday, the U.S.`s melting furnace manufacturing companies urged the ITC to impose a tariff of 40 percent on steel imports, or a minimum of 100 dollars per ton, whichever is greater, in order to resuscitate the U.S.`s steel industry harmed by low-price steel imports.

The U.S. steel firms stressed that the collected tariffs should be used for corporate restructuring such as M & A and facility reduction to bring the U.S. steel industry to life.

The United Steel Workers of America (USWA) also presented to the ITC an opinion letter demanding on a 50 percent tariff on all carbon and alloy steel products except stainless steel, and a quota system based on the average steel imports in 1994-1997.

And the USWA insisted on the work-out of steel industry led by the government.

The Korean Iron and Steel Association (KOSA) said, ``All U.S. steel firms were mobilized to demand the U.S. government for import restriction on the steel products. Since such a series of action was not taken once and for all, we should set up the strong countermeasure.``

Meanwhile, the steel delegation led by Lee Seok-Young, assistant secretary of the Ministry of Commerce, Industry and Energy, expressed dissatisfaction on the ITC`s decision of industrial damage impaired by import steel in a meeting with the U.S. assistant secretary of commerce at Washington.

The delegation pointed out that the hardship of the U.S. steel industry has been brought about the prolongation of the restructuring, and requested to have a prior consultation with the Korean government in deciding for the enforcement of the safeguard.

The ITC is expected to expose the outline of its recommendation on `Section 201` around 30th, which will be officially presented to U.S. President George W. Bush on Dec. 19th.

daviskim@donga.com