[A-List] Steel: US slept while Europe, Japan innovated

[Sabri Oncu <soncu@xxxxxxxxxxx>]

Forwarded from Progressive Economists Network

Sabri

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The Economic Times

Friday, April 26, 2002

US slept while Europe, Japan innovated

AFP


TOKYO: US tariffs on European and Japanese steel imports were
unfair because US steelmakers had for half a century lacked the
innovation to compete with their products, European Commission
President Romano Prodi said on Friday.

"All the innovations in the steel industry in the post-War period
were either European or Japanese. The Americans in this sector
simply slept," said Prodi during a press conference on a 40-hour
working visit here.

The head of the EU's executive body, who said he could speak with
some authority as the former head of Italy's now-defunct
state-owned steel company, said that it was "completely out of
the rule" for Washington to protect its laggard industry with
customs tariffs.

Prodi said he would deliver the same blunt message to US
President George W Bush when he meets him in Washington on May 2.

Earlier this week the United States urged the European Union to
abandon plans to retaliate against US steel import tariffs,
saying such action would flout world trade rules.

But Prodi insisted the Commission's consideration of what he
called "re-balancing measures" was entirely in conformity with
World Trade Organization (WTO) rules.

In March, the US imposed tariffs of between eight and 30 per cent
on steel imports except those from countries such as Canada and
Mexico, which have free trade agreements with Washington, to
allow its ailing steel industry to
restructure.

Six WTO members -- including the European Union and Japan -- have
since lodged complaints under the WTO's dispute settlement
mechanism.

The EU, which has taken the issue to the Geneva-based WTO, has
estimated the damage from the tariffs at 2.5 billion euros ($2.2
billion).

In order to apply the retaliatory measures, Brussels would also
have to send a list of products to the WTO by mid-May and apply
the sanctions by mid-June.

Under the European Commission plan, the punitive tariffs would
come into effect by June 18.

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