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U.S.: Bush Lifts Tariffs On Imported Steel

Washington, 5 December 2003 (RFE/RL) -- U.S. President George W. Bush has lifted 20-month-old tariffs on imported steel, averting a threatened economic retaliation by Europe and Asia.

The move was announced yesterday by White House spokesman Scott McClellan. He read to reporters a written statement issued by Bush.

"I took action to give the industry a chance to adjust to the surge in foreign imports and to give relief to the workers and communities that depend on steel for their jobs and livelihoods," Bush said in his statement. "These safeguard measures have now achieved their purpose and, as a result of changed economic circumstances, it is time to lift them."

The tariffs covered a wide range of steel products. They were originally scheduled to remain in effect for three years, until 2005. Bush had said he wanted to give U.S. steelmakers protection from what the administration considered unfair foreign competition, inexpensive products sometimes subsidized by governments.

Bush lifted the tariffs after the European Union and other trading partners threatened to impose more than $2.2 billion in sanctions on a wide range of U.S. products.

At a news conference, U.S. Trade Representative Robert Zoellick said it was time to reverse course because the situation facing the American steel industry has improved greatly. He said recent sales of domestic steel and company profits were up significantly.

"It provided the steel industry with the breeding space they needed to regain its competitiveness. Jobs have been saved, steel businesses have been given another chance to compete," Zoellick said. "Since the safeguard has been in place, the industry has undergone major restructuring and consolidation."

Zoellick said the tariffs were not meant to be permanent. "To help very open economies like ours to adjust to rapid and sharp changes, we sometime provide temporary safeguards from imports. Such relief is an acceptable principle of global trade rules," he said.

Zoellick also said the president's decision was not influence by the threatened sanctions.

America's largest steelworkers union criticized Bush's action.

The United Steelworkers of America said the administration had caved in to "blackmail" and betrayed workers and steel communities.

Speaking in Brussels, European Union Trade Commissioner Pascal Lamy praised Bush's decision.

"This is obviously good news for European steel, good news for European steelmakers, good news for European steelworkers. It's good news for Europe."

Lamy also announced the EU's decision to lift the threatened trade sanctions against the United States.

"These sanctions, as I have always said, were there as a tool for compliance. They (the United States) have complied, and the sanctions will disappear," Lamy said. "As you all know, they would have entered in force on the 15 December had the Americans not withdrawn their measures. They've done it -- the sanctions disappear."